Biotech Growth Trust PLC (BIOG.L) WACC Analysis

As of May 22, 2025, Biotech Growth Trust PLC (BIOG.L) carries a Weighted Average Cost of Capital (WACC) of 9.6%. WACC reflects the blended rate Biotech Growth Trust PLC must pay to both equity and debt holders.

Within that, the cost of equity is 9.6%, the cost of debt is 4.0%, and the effective tax rate is 0.1%.

Breakdown of WACC Components

• Long-term bond rate: 4.0% – 4.5%
• Equity market risk premium: 6.0% – 7.0%
• Adjusted beta: 0.94 – 1
• Additional risk adjustment: 0.0% – 0.5%
• Debt-to-equity ratio: 0.23

What It Means for Investors

With a selected WACC of 9.6%, Biotech Growth Trust PLC must ensure any new investment returns exceed this threshold to generate shareholder value. This level reflects a moderate financing cost structure.