The WACC of Del Monte Pacific Ltd (D03.SI) is 11.1%.
Range | Selected | |
Cost of equity | 18.4% - 40.6% | 29.5% |
Tax rate | 25.9% - 31.9% | 28.9% |
Cost of debt | 7.0% - 22.7% | 14.85% |
WACC | 5.8% - 16.5% | 11.1% |
Category | Low | High |
Long-term bond rate | 2.7% | 3.2% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 3.07 | 6.05 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 18.4% | 40.6% |
Tax rate | 25.9% | 31.9% |
Debt/Equity ratio | 22.78 | 22.78 |
Cost of debt | 7.0% | 22.7% |
After-tax WACC | 5.8% | 16.5% |
Selected WACC | 11.1% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
D03.SI | Del Monte Pacific Ltd | 22.78 | 0.2 | 0.01 |
002567.SZ | Tangrenshen Group Co Ltd | 1.09 | 1.21 | 0.67 |
002726.SZ | Shandong Longda Meat Foodstuff Co Ltd | 0.51 | 0.89 | 0.65 |
004370.KS | Nongshim Co Ltd | 0.07 | 0.63 | 0.6 |
F99.SI | Fraser and Neave Ltd | 0.65 | 0.45 | 0.3 |
JPFA.JK | Japfa Comfeed Indonesia Tbk PT | 0.51 | 0.86 | 0.62 |
MV4.SI | Mewah International Inc | 2.33 | -0.09 | -0.03 |
P34.SI | Delfi Ltd | 0.09 | 0.42 | 0.4 |
Q01.SI | QAF Ltd | 0.07 | 0.13 | 0.12 |
UD2.SI | Japfa Ltd | 1.21 | 0.15 | 0.08 |
Low | High | |
Unlevered beta | 0.23 | 0.48 |
Relevered beta | 4.09 | 8.54 |
Adjusted relevered beta | 3.07 | 6.05 |
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 D03.SI:
cost_of_equity (29.50%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (3.07) + 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.