2340.SR WACC - Weighted Average Cost of Capital
The WACC of Al Abdullatif Industrial Investment Company SJSC (2340.SR) is 9.6%.
| Range | Selected | |
| Cost of equity | 9.4% - 12.5% | 10.95% |
| Tax rate | 20.0% - 20.0% | 20% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.3% - 10.9% | 9.6% |
| Category | Low | High |
| Long-term bond rate | 5.9% | 6.4% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.57 | 0.79 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.4% | 12.5% |
| Tax rate | 20.0% | 20.0% |
| Debt/Equity ratio | 0.24 | 0.24 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.3% | 10.9% |
| Selected WACC | 9.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 2340.SR | Al Abdullatif Industrial Investment Company SJSC | 0.24 | 1.4 | 1.18 |
| 1198.HK | Royale Home Holdings Ltd | 4.33 | 0.03 | 0.01 |
| 1213.SR | Naseej International Trading Co | 0.18 | 0.77 | 0.67 |
| 2130.SR | Saudi Industrial Development Company SJSC | 0.09 | 1.24 | 1.15 |
| 5956.T | Toso Co Ltd | 0.38 | 0.1 | 0.08 |
| 603038.SS | Dongguan Huali industries Co Ltd | 0.17 | 0.97 | 0.85 |
| 603709.SS | Zoy Home Furnishing Co Ltd | 0.38 | 0.66 | 0.51 |
| 776.HK | Imperium Group Global Holdings Ltd | 0.33 | -0.14 | -0.11 |
| 8482.TW | Shane Global Holding Inc | 0.01 | 0.42 | 0.42 |
| SERNKOU.KL | Sern Kou Resources Bhd | 0.12 | 0.14 | 0.12 |
| Low | High | |
| Unlevered beta | 0.3 | 0.58 |
| Relevered beta | 0.36 | 0.69 |
| Adjusted relevered beta | 0.57 | 0.79 |
2340.SR'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 2340.SR:
cost_of_equity (10.95%) = risk_free_rate (6.15%) + equity_risk_premium (6.60%) * adjusted_beta (0.57) + 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.