8360.HK WACC - Weighted Average Cost of Capital

The WACC of Al Group Ltd (8360.HK) is 5.7%.

The Cost of Equity of Al Group Ltd (8360.HK) is 6.35%.

The Cost of Debt of Al Group Ltd (8360.HK) is 4.35%.

	Range	Selected
Cost of equity	5.40% - 7.30%	6.35%
Tax rate	0.10% - 0.20%	0.15%
Cost of debt	4.20% - 4.50%	4.35%
WACC	5.0% - 6.4%	5.7%

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	0.42	0.49

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.40%	7.30%

Tax rate	0.10%	0.20%
Debt/Equity ratio	0.5	0.5
Cost of debt	4.20%	4.50%

After-tax WACC	5.0%	6.4%


Selected WACC	5.7%

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 (6.35%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.42) + 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.