ADFFOODS.NS WACC - Weighted Average Cost of Capital

The WACC of ADF Foods Ltd (ADFFOODS.NS) is 14.2%.

The Cost of Equity of ADF Foods Ltd (ADFFOODS.NS) is 14.15%.

The Cost of Debt of ADF Foods Ltd (ADFFOODS.NS) is 22.90%.

	Range	Selected
Cost of equity	12.30% - 16.00%	14.15%
Tax rate	24.90% - 25.20%	25.05%
Cost of debt	7.50% - 38.30%	22.90%
WACC	12.2% - 16.2%	14.2%

WACC

ADFFOODS.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.66	0.87

Additional risk adjustments	0.0%	0.5%
Cost of equity	12.30%	16.00%

Tax rate	24.90%	25.20%
Debt/Equity ratio	0.02	0.02
Cost of debt	7.50%	38.30%

After-tax WACC	12.2%	16.2%


Selected WACC	14.2%

ADFFOODS.NS'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 ADFFOODS.NS:

cost_of_equity (14.15%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.66) + 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.