The increasing need for capacity has led the railway industry to explore next generation signalling concepts such as Virtual Coupling which takes moving-block operations further by separating trains by a relative braking distance, like cars on the road. By means of a Vehicle-to-Vehicle (V2V) communication architecture trains can move in a virtually coupled platoon which can be treated as a single convoy at junctions to improve capacity. This concept however introduces the need for additional safety constraints, especially at diverging junctions, which could make actual capacity improvements insufficient to justify investments. Hence, there is a need to understand capacity performances of Virtual Coupling and potential gains over state-of-practice signalling systems. This paper addresses this need by developing an innovative train-following model that captures operational states and corresponding transitions of trains running under Virtual Coupling. A comparative capacity analysis has been conducted for a portion of the South West Main Line in the UK. Promising results have been obtained, showing that the biggest capacity gains returned by Virtual Coupling relate to operational scenarios normally found in practice with trains having service stops and using different routes.