Capital Asset Pricing Model with Asset Growth Muhammad Irfan mi_fuu@yahoo.com Abstract Recent studies suggest that the conditional CAPM might hold, period-by-period, and that time- varying betas can explain the failures of the simple, unconditional CAPM. We argue, that significant betas are affecting the returns of firm. Capital Assets Pricing Model (CAPM) is the widely tested, accepted and rejected model of asset pricing. This study tested the CAPM with addition of asset growth on a specific Industry of Pakistan selected from KSE-100 index. After testing the CAPM with addition of asset growth this study suggested that CAPM is may be useful to forecast the required return but many other factors are there which are important to include and study. When this study assume all other factors are constant than we calculate the required return but these results are not 100% accurate may be some important things are miss here. This study suggested that many other factors have impact on future returns. Key word: Beta, Required Return, Actual Return, Risk Free Rate, Market Return, Capital Asset Pricing Model, Asset Growth. Etc