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TO EQUITY VALUATION
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Cash Inflow
Column 1 * 3
3.50
D
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45
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CF
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Solution,
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Year
Future Value
PVIF @ 20%
PVIF * F.V
DCC
FF
C
F!E
DE
CE
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Total
C
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Example,
Excel Chemicals Company: Summarized Balance Sheet
Rs. In
Rs. In
Crore
Crore
&-)'(&**-0.
",)("&3.()$*-0.
,#.-/',/#%,3E')&)($",)($&*$
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Excel chemicals summarized profit and loss account and per share data
(%,3($
&$%&*5&&.$$&3.
(/)('#,%#&0
(33#05,0. .2#0#$%),%#9((=/(0$(
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Solution,
Particulars
2004
2005
2006
2007
F!E
D
DDF
!E
D
DC
CEC
C
CC
C
CC
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E
EE
F
ED
!D
F
C
EE
F!
DF
F
C
!
F
!D
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E
EE
F
Cash Flows
C
D
E
ED
Less: CAPEX
D!
!
C
CF
F
143
61
85
111
Sales
Less: Cost of goods sold
(% of Sales)
(% of
Sales)
Working Notes,
1) Calculation of Depreciation;
Year
Asset
(Rs.)
2004
2005
2006
2007
Capital
Expenditure
Total Assets
EI&*,3($
C
!
&3-20NC
D!
F
!
E
EE
!
!
Sales
F!E
D
DDF
Working Capital as % of
Sales
CI
CI
CI
CI
Working Capital
E E
FE
F
FD
Change in Working
Capital
C
CF
F
MYFI
!
MDCI
Calculation of WACC (Weighted Average Cost of Capital);
e
d
MNF
CIFI
M$FD
&%,3,3-(&*%"(#)2M(%,$"3&7YXCI
Year
Net Cash Flow
PVIF @ 13%
2005 F
DDE
2006 DE
DC
2007
F!C
FD,39,5(,3-(
F!C
Total Value Of the Firm
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Particulars
Amt (Rs.)
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-))(0%
(Less)
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(Multiply)
(1%),%#&
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CI D
F
CI
4.85
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$0,8"
Liabilities
Share Capital
40,000 11% Preference Share
Amt (Rs.)
Assets
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E
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282
282
Additional Information:
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Amt (Rs.)
Amt(Rs.)
Current Assets:
Stocks
Debtors
E
F
Total Assets
D
10% Debentures
Trade Creditors
(0.11 * Rs 40 Lakh)
C
CFF
113.83
Particulars
Amt (Rs.)
Amt(Rs.)
C
Current Assets:
Stocks
Debtors
E
E
Total Assets
D
C
CF
119.67
Amt (Rs.)
Amt(Rs.)
E
Current Assets:
Stocks
!
Debtors
Total Assets
E
C
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