BPCR.L WACC - Weighted Average Cost of Capital
The WACC of BioPharma Credit PLC (BPCR.L) is 8.9%.
| Range | Selected | |
| Cost of equity | 11.3% - 16.1% | 13.7% |
| Tax rate | 19.0% - 19.0% | 19% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.7% - 10.1% | 8.9% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 5.5% | 6.5% |
| Adjusted beta | 1.32 | 1.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.3% | 16.1% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.7% | 10.1% |
| Selected WACC | 8.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| BPCR.L | BioPharma Credit PLC | 0.99 | 0.28 | 0.16 |
| DBAN.DE | Deutsche Beteiligungs AG | 0.29 | 0.95 | 0.77 |
| EQV1V.HE | eQ Oyj | 0.01 | 0.57 | 0.57 |
| GIMB.BR | Gimv NV | 0.23 | 0.74 | 0.62 |
| GROW.L | Draper Esprit PLC | 0.16 | 1.82 | 1.61 |
| IPO.L | IP Group PLC | 0.38 | 1.5 | 1.15 |
| LIO.L | Liontrust Asset Management PLC | 0.02 | 1.69 | 1.67 |
| LWDB.L | Law Debenture Corporation PLC | 0.14 | 1.26 | 1.13 |
| OCI.L | Oakley Capital Investments Ltd | 0.13 | 0.95 | 0.86 |
| POLR.L | Polar Capital Holdings PLC | 0.01 | 1.87 | 1.85 |
| SNN.L | Sanne Group PLC | 0.1 | 0.29 | 0.26 |
| Low | High | |
| Unlevered beta | 0.77 | 1.13 |
| Relevered beta | 1.48 | 2.06 |
| Adjusted relevered beta | 1.32 | 1.71 |
BPCR.L'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 BPCR.L:
cost_of_equity (13.70%) = risk_free_rate (4.25%) + equity_risk_premium (6.00%) * adjusted_beta (1.32) + 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.