VCP.L WACC - Weighted Average Cost of Capital
The WACC of Victoria PLC (VCP.L) is 7.9%.
| Range | Selected | |
| Cost of equity | 17.3% - 24.2% | 20.75% |
| Tax rate | 12.8% - 17.2% | 15% |
| Cost of debt | 4.1% - 12.5% | 8.3% |
| WACC | 4.5% - 11.3% | 7.9% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 2.23 | 2.76 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 17.3% | 24.2% |
| Tax rate | 12.8% | 17.2% |
| Debt/Equity ratio | 13.53 | 13.53 |
| Cost of debt | 4.1% | 12.5% |
| After-tax WACC | 4.5% | 11.3% |
| Selected WACC | 7.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| VCP.L | Victoria PLC | 13.53 | 0.1 | 0.01 |
| ACWN.DE | AS Creation Tapeten AG | 0.67 | 0.07 | 0.05 |
| ALU10.PA | U10 Corp SA | 1.9 | 0.74 | 0.29 |
| DFS.L | DFS Furniture PLC | 1.6 | 0.45 | 0.19 |
| FORN.SW | Forbo Holding AG | 0.04 | 1.14 | 1.11 |
| FTE.WA | Fabryki Mebli Forte SA | 0.55 | 0.38 | 0.26 |
| NOBI.ST | Nobia AB | 2.17 | 1.02 | 0.37 |
| SUR.DE | Surteco Group SE | 1.76 | 0.22 | 0.09 |
| TCM.CO | TCM Group A/S | 0.38 | 0.41 | 0.31 |
| YATAS.IS | Yatas Yatak ve Yorgan Sanayi Ticaret AS | 0.22 | 1.44 | 1.22 |
| Low | High | |
| Unlevered beta | 0.23 | 0.3 |
| Relevered beta | 2.84 | 3.63 |
| Adjusted relevered beta | 2.23 | 2.76 |
VCP.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 VCP.L:
cost_of_equity (20.75%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (2.23) + 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.