HERITGFOOD.NS WACC - Weighted Average Cost of Capital

The WACC of Heritage Foods Ltd (HERITGFOOD.NS) is 15.2%.

The Cost of Equity of Heritage Foods Ltd (HERITGFOOD.NS) is 15.60%.

The Cost of Debt of Heritage Foods Ltd (HERITGFOOD.NS) is 12.40%.

	Range	Selected
Cost of equity	13.70% - 17.50%	15.60%
Tax rate	26.50% - 26.80%	26.65%
Cost of debt	7.60% - 17.20%	12.40%
WACC	13.2% - 17.2%	15.2%

WACC

HERITGFOOD.NS WACC calculation

Category	Low	High

Long-term bond rate	6.9%	7.4%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.82	1.03

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.70%	17.50%

Tax rate	26.50%	26.80%
Debt/Equity ratio	0.06	0.06
Cost of debt	7.60%	17.20%

After-tax WACC	13.2%	17.2%


Selected WACC	15.2%

HERITGFOOD.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 HERITGFOOD.NS:

cost_of_equity (15.60%) = risk_free_rate (7.15%) + equity_risk_premium (8.80%) * adjusted_beta (0.82) + 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.