HNDFDS.NS WACC - Weighted Average Cost of Capital
The WACC of Hindustan Foods Ltd (HNDFDS.NS) is 15.4%.
| Range | Selected | |
| Cost of equity | 14.5% - 18.0% | 16.25% |
| Tax rate | 27.7% - 30.1% | 28.9% |
| Cost of debt | 9.1% - 14.5% | 11.8% |
| WACC | 13.7% - 17.2% | 15.4% |
| Category | Low | High |
| Long-term bond rate | 6.9% | 7.4% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.92 | 1.09 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 14.5% | 18.0% |
| Tax rate | 27.7% | 30.1% |
| Debt/Equity ratio | 0.12 | 0.12 |
| Cost of debt | 9.1% | 14.5% |
| After-tax WACC | 13.7% | 17.2% |
| Selected WACC | 15.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| HNDFDS.NS | Hindustan Foods Ltd | 0.12 | 1.25 | 1.15 |
| ADFFOODS.NS | ADF Foods Ltd | 0.02 | 1.3 | 1.28 |
| ATFL.NS | Agro Tech Foods Ltd | 0.01 | 0.61 | 0.61 |
| BANARISUG.NS | Bannari Amman Sugars Ltd | 0.03 | 0.59 | 0.58 |
| BECTORFOOD.NS | Mrs. Bectors Food Specialities Ltd | 0.03 | 1.19 | 1.16 |
| CCL.NS | CCL Products India Ltd | 0.15 | 0.7 | 0.63 |
| DFMFOODS.NS | DFM Foods Ltd | 0.05 | 0.97 | 0.94 |
| DIAMONDYD.NS | Prataap Snacks Ltd | 0.03 | 0.58 | 0.57 |
| TASTYBITE.NS | Tasty Bite Eatables Ltd | 0.03 | 1.02 | 1 |
| VADILALIND.NS | Vadilal Industries Ltd | 0.06 | 1.17 | 1.12 |
| Low | High | |
| Unlevered beta | 0.81 | 1.05 |
| Relevered beta | 0.88 | 1.13 |
| Adjusted relevered beta | 0.92 | 1.09 |
HNDFDS.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 HNDFDS.NS:
cost_of_equity (16.25%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.92) + 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.