8360.HK WACC - Weighted Average Cost of Capital

The WACC of Al Group Ltd (8360.HK) is 7.2%.

The Cost of Equity of Al Group Ltd (8360.HK) is 6.10%.

The Cost of Debt of Al Group Ltd (8360.HK) is 9.75%.

	Range	Selected
Cost of equity	5.00% - 7.20%	6.10%
Tax rate	0.10% - 0.20%	0.15%
Cost of debt	7.00% - 12.50%	9.75%
WACC	5.6% - 8.7%	7.2%

WACC

8360.HK WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.36	0.48

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.00%	7.20%

Tax rate	0.10%	0.20%
Debt/Equity ratio	0.41	0.41
Cost of debt	7.00%	12.50%

After-tax WACC	5.6%	8.7%


Selected WACC	7.2%

8360.HK'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 8360.HK:

cost_of_equity (6.10%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.36) + 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.