8413.HK WACC - Weighted Average Cost of Capital

The WACC of Asia Grocery Distribution Ltd (8413.HK) is 7.1%.

The Cost of Equity of Asia Grocery Distribution Ltd (8413.HK) is 5.60%.

The Cost of Debt of Asia Grocery Distribution Ltd (8413.HK) is 18.35%.

	Range	Selected
Cost of equity	4.90% - 6.30%	5.60%
Tax rate	6.00% - 10.10%	8.05%
Cost of debt	5.10% - 31.60%	18.35%
WACC	4.9% - 9.3%	7.1%

WACC

8413.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.34	0.35

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.90%	6.30%

Tax rate	6.00%	10.10%
Debt/Equity ratio	0.15	0.15
Cost of debt	5.10%	31.60%

After-tax WACC	4.9%	9.3%


Selected WACC	7.1%

8413.HK's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for 8413.HK:

cost_of_equity (5.60%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.34) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.