The WACC of Surapon Foods PCL (SSF.BK) is 7.4%.
Range | Selected | |
Cost of equity | 6.8% - 10.7% | 8.75% |
Tax rate | 8.6% - 10.1% | 9.35% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 6.0% - 8.8% | 7.4% |
Category | Low | High |
Long-term bond rate | 2.6% | 3.1% |
Equity market risk premium | 7.4% | 8.4% |
Adjusted beta | 0.58 | 0.84 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.8% | 10.7% |
Tax rate | 8.6% | 10.1% |
Debt/Equity ratio | 0.38 | 0.38 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 6.0% | 8.8% |
Selected WACC | 7.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
SSF.BK | Surapon Foods PCL | 0.38 | 0.42 | 0.31 |
BR.BK | Bangkok Ranch PCL | 3.5 | 0.18 | 0.04 |
CFRESH.BK | Seafresh Industry PCL | 2.28 | 0.94 | 0.31 |
F&D.BK | Food and Drinks PCL | 0.02 | 0.98 | 0.96 |
LST.BK | Lam Soon Thailand PCL | 0.24 | 0.2 | 0.16 |
MALEE.BK | Malee Group PCL | 0.5 | 1.73 | 1.19 |
TC.BK | Tropical Canning Thailand PCL | 0.29 | -0.09 | -0.07 |
TKN.BK | Taokaenoi Food & Marketing PCL | 0.02 | 1.2 | 1.18 |
UVAN.BK | Univanich Palm Oil PCL | 0.01 | 0.23 | 0.23 |
XO.BK | Exotic Food PCL | 0.01 | 1.02 | 1.02 |
Low | High | |
Unlevered beta | 0.27 | 0.57 |
Relevered beta | 0.37 | 0.76 |
Adjusted relevered beta | 0.58 | 0.84 |
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 SSF.BK:
cost_of_equity (8.75%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.58) + 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.