Risk free Rate 6.

50%
Beta 1
Market Risk Premium 5.50%
Cost of Equity 12.00%

No. of Share Outstanding 63

Debt Ratio 5%

Year 1993 1994 1995 1996 1997 1998

Revenue 1000 1060 1124 1191 1262 1338
Growth Rate 6% 6% 6% 6% 6%
EPS 2.35 2.71 3.13 3.62 4.18 4.83
Growth Rate 15.5% 15.5% 15.5% 15.5% 15.5%
Capex per Share 2.25
Dep per Share 1.125
Capex-Dep, per Share 1.125 1.30 1.50 1.73 2.00 2.31
Growth Rate 15.5% 15.5% 15.5% 15.5% 15.5%
Working Capital as % of Revenue 5% 5% 5% 5% 5% 5%
WC 50.00 53.00 56.18 59.55 63.12 66.91
WC per Share 0.79 0.84 0.89 0.95 1.00 1.06
(1-DR) * (Capex - Dep) 1.07 1.23 1.43 1.65 1.90 2.20
(1-DR) * (Change WC) 0.045 0.048 0.051 0.054 0.057
FCFE 1.43 1.66 1.92 2.23 2.58
Terminal Value 45.85
Total 1.43 1.66 1.92 2.23 48.43
Value per Share 32.87
 1999
1392
4%
5.12
6.0%

2.45 <- this will chage from 0 to 2.45 for part b

6.0%
5%
69.59
1.10
2.33
0.040
2.75
Risk free Rate 7.00%
Beta 1.2
Market Risk Premium 5.50%
Cost of Equity 13.60%
Beta 2 (After 1998) 1.10
New Cost of Equity 13.05%

No. of Share Outstanding 7

Debt Ratio 10%

Year 1993 1994 1995 1996 1997 1998

Revenue 106 112 119 126 134 142
Growth Rate 6% 6% 6% 6% 6%
EPS 2.02 2.30 2.63 2.99 3.41 3.89
Growth Rate 14.0% 14.0% 14.0% 14.0% 14.0%
Capex 4.2
Capex per Share 0.6
Dep 2
Dep per Share 0.28571 0.33 0.37 0.42 0.48 0.55
Capex-Dep, per Share 0.31429 0.36 0.41 0.47 0.53 0.61
Growth Rate 14.0% 14.0% 14.0% 14.0% 14.0%
Working Capital as % of Revenue 50% 50% 50% 50% 50% 50%
WC 53.00 56.18 59.55 63.12 66.91 70.93
WC per Share 7.57 8.03 8.51 9.02 9.56 10.13
(1-DR) * (Capex - Dep) 0.28 0.32 0.37 0.42 0.48 0.54
(1-DR) * (Change WC) 0.409 0.433 0.459 0.487 0.516
FCFE 1.57 1.82 2.11 2.45 2.83
Terminal Value 58.38
Total 1.57 1.82 2.11 2.45 61.21
Value per Share 38.06

1.78
13.05%
5%
22.1118
 1999
148
4%
4.16
7.0%

0.88

0.59
0.29
7.0%
50%
73.76
10.54
0.26
0.365
3.53
 1993 1994 1995 1996
Growth
Growth in in revenues
EPS, Capex & 17.00% ### ###
Dep 17.00% ### ###
Revenues 2.91 3.40 3.98 4.66
EPS 0.56 0.66 0.77 0.90
Capex per share 0.13 0.15 0.18 0.21
Dep per share 0.08 0.09 0.11 0.13
Capex - Dep 0.05 0.06 0.07 0.08
Debt Ratio 10% 10% 10% 10%
(1-DR) (Capex - Dep) 0.05 0.05 0.06 0.07
WC as % of revenue 60% 60% 60% 60%
WC 1.75 2.04 2.39 2.80
(1-DR)(change in WC) 0.27 0.31 0.37
FCFE [1-2-3] 0.34 0.39 0.46
RFR 7% 7% 7%
Beta 1.45 1.45 1.45
Premium 5.50% 5.50% 5.50%
Cost of Equity 14.98% ### ###
Terminal Value
PV 0.29 0.30 0.30
NPV ###
 1997 1998 1999 2000 2001 2002 2003 2004
### ### 14.60% 12.20% 9.80% 7.40% 5.00% 5.00%
### ### 14.60% 12.20% 9.80% 7.40% 5.00% 5.00%
5.45 6.38 7.31 8.20 9.01 9.67 10.16 ###
1.05 1.23 1.41 1.58 1.73 1.86 1.95 2.05
0.24 0.29 0.33 0.37 0.40 0.43 0.45
0.15 0.18 0.20 0.23 0.25 0.27 0.28
0.09 0.11 0.13 0.14 0.15 0.17 0.17 -
10% 10% 10% 10% 10% 10% 10% 10%
0.08 0.10 0.11 0.13 0.14 0.15 0.16 -
60% 60% 60% 60% 60% 60% 60% 60%
3.27 3.83 4.39 4.92 5.40 5.80 6.09 6.40
0.43 0.50 0.50 0.48 0.43 0.36 0.26 0.27
0.54 0.63 0.79 0.97 1.16 1.35 1.54 1.78
7% 7% 7% 7% 7% 7% 7% 7%
1.45 1.45 1.38 1.31 1.24 1.17 1.1 1.1
5.50% 5.50% 5.50% 5.50% 5.50% 5.50% 5.50% 5.50%
### ### 14.59% 14.21% 13.82% 13.44% 13.05% ###
22.09
0.31 0.31 0.35 0.38 0.41 0.43 6.93
 1993 1994 1995 1996
Growth
Growth in in revenues
EPS, Capex & 20.00% ### ###
Dep 20.00% ### ###
Revenues 12.5 15.00 ### ###
EPS 0.85 1.02 1.22 1.47
Capex per share 0 - - -
Dep per share 0 - - -
Capex - Dep - - - -
Debt Ratio 15% 15% 15% 15%
(1-DR) (Capex - Dep) - - - -
WC as % of revenue 40% 40% 40% 40%
WC 5.00 6.00 7.20 8.64
(1-DR)(change in WC) 0.85 1.02 1.22
FCFE [1-2-3] 0.17 0.20 0.24
RFR 7% 7% 7%
Beta 1.1 1.1 1.1
Premium 5.50% 5.50% 5.50%
Cost of Equity 13.05% ### ###
Terminal Value
PV 0.15 0.16 0.17
NPV ###
 1997 1998 1999 2000 2001 2002
### ### 15.00% 10.00% 5.00% 5.00%
### ### 15.00% 10.00% 5.00% 5.00%
### ### 35.77 39.35 41.31 43.38
1.76 2.12 2.43 2.68 2.81 2.95
- - - - - -
- - - - - -
- - - - - -
15% 15% 15% 15% 15% 15%
- - - - - -
40% 40% 40% 40% 40% 40%
### ### 14.31 15.74 16.53 17.35
1.47 1.76 1.59 1.22 0.67 0.70
0.29 0.35 0.85 1.46 2.14 2.25
7% 7% 7% 7% 7% 7%
1.1 1.1 1.1 1.1 1.1 1.1
5.50% 5.50% 5.50% 5.50% 5.50% 5.50%
### ### 13.05% 13.05% 13.05% 13.05%
27.92
0.18 0.19 0.41 0.62 11.27
 Growth Phase Steady Phase
Risk free Rate 7.00% Risk free Rate 7.00%
Beta 1.1 Unlevered Beta 0.74
Market Risk Premium 5.50% Target DE Ratio 50%
Cost of Equity 13.05% Levered Beta 0.96
Value of Equity 3,968.00 0.55 Market Risk Prem 5.50%
Cost of Debt 8.00% Cost of Equity 12.30%
Tax Rate 40.00% Cost of Debt 7.50%
AT Cost of Debt 4.80% Tax Rate 40.00%
Value of Debt 3200 0.45 AT Cost of Debt 4.50%
D/V 0.33
Cost of Capital 9.37% E/V 0.67
Cost of Capital 9.70% ---> This is for TV Calculations

No. of Share Outstanding 62

Year 2013 2014 2015 2016 2017

Revenue 13500 14783 16187 17725 19408
Growth Rate 10% 10% 10% 10%
EBITDA 1290
Depreciation 400
EBIT 890 974.6 1,067.1 1,168.5 1,279.5
Tax Rate 40% 40% 40% 40%
EBIT (1-T) 584.73 640.28 701.11 767.71
Capex 450 492.75 539.56 590.82 646.95
Dep 400 438.00 479.61 525.17 575.06
Capex-Dep 50 54.75 59.95 65.65 71.88
Growth Rate 9.5% 9.5% 9.5% 9.5%
Working Capital as % of Revenue 7% 7% 7% 7% 7%
WC 945.00 1,034.78 1,133.08 1,240.72 1,358.59
Change in WC 89.78 98.30 107.64 117.87
FCFF 440.21 482.02 527.82 577.96
Terminal Value
Total 440.21 482.02 527.82 577.96
Value of Firm 11,152.43

Value of Debt 3200

Value of Equity 7,952.43
Value per Share 128.26
-> This is for TV Calculations

2018 2019
21252 22102
10% 4%

1,401.1 1,457.1
40% 40%
840.64 874.27
708.41 736.74
629.70 654.88
78.71 -
9.5% 4.0%
7% 7%
1,487.66 1,547.16
129.07 59.51
632.87 814.76
14293.54
14,926.41