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Calculation of Free Cashflow To The Firm: DCF Valuation (Amounts in Millions)

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Prachi Navghare

This document provides financial information and calculations to estimate the discounted cash flow valuation of a company from 2017-2022. It summarizes key financial figures like EBIT, capital expenditures, depreciation, and free cash flow to the firm. It then calculates the weighted average cost of capital, estimates the terminal value in 2022, discounts future free cash flows to calculate enterprise value of $2.14B, and estimates the intrinsic value per share is $7,079, indicating the current market price is undervalued.

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Calculation of Free Cashflow To The Firm: DCF Valuation (Amounts in Millions)

Uploaded by

Prachi Navghare
49 views1 page
This document provides financial information and calculations to estimate the discounted cash flow valuation of a company from 2017-2022. It summarizes key financial figures like EBIT, capital expenditures, depreciation, and free cash flow to the firm. It then calculates the weighted average cost of capital, estimates the terminal value in 2022, discounts future free cash flows to calculate enterprise value of $2.14B, and estimates the intrinsic value per share is $7,079, indicating the current market price is undervalued.

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VALUATION OF MARUTI SUZUKI

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Valuation

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This document provides financial information and calculations to estimate the discounted cash flow valuation of a company from 2017-2022. It summarizes key financial figures like EBIT, capital expenditures, depreciation, and free cash flow to the firm. It then calculates the weighted average cost of capital, estimates the terminal value in 2022, discounts future free cash flows to calculate enterprise value of $2.14B, and estimates the intrinsic value per share is $7,079, indicating the current market price is undervalued.

Copyright:

© All Rights Reserved
Download as PDF, TXT or read online from Scribd
Download as pdf or txt
49 views1 page

Calculation of Free Cashflow To The Firm: DCF Valuation (Amounts in Millions)

Uploaded by

Prachi Navghare
This document provides financial information and calculations to estimate the discounted cash flow valuation of a company from 2017-2022. It summarizes key financial figures like EBIT, capital expenditures, depreciation, and free cash flow to the firm. It then calculates the weighted average cost of capital, estimates the terminal value in 2022, discounts future free cash flows to calculate enterprise value of $2.14B, and estimates the intrinsic value per share is $7,079, indicating the current market price is undervalued.

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DCF Valuation (Amounts In Millions)

Calculation of Free Cashflow to the Firm


2017 2018 2019 2020 2021 2022
CA (excluding cash) 87,745 155,109 173,369 193,779 216,591 242,089
CL (excluding short term debt) 127,532 149,229 166,796 186,432 208,380 232,911
Working Capital (39,787) 5,881 6,573 7,347 8,212 9,178

EBIT 101,272 80,701 85,937 91,789 98,330 105,641


Changes in WC (33,906) 692 774 865 967
Deprecition and Amortization 26,039 34,829 38,929 43,512 48,635 54,360
Capex 32,524 47,280 52,846 59,067 66,020 73,793
Tax Rate
26%
FCFF ( EBIT-Tax-Changes in wc-
capex+depreciation) 13,496.17 49,127.60 51,748.02 54,676.93 57,950.64
PV OF FCFF INR 12,342.52 INR 49,127.60 INR 51,748.02 INR 54,676.93 INR 57,950.64
1 2 3 4 5
2014 2015 2016 2017
PBT 37,338 49,760 75,847 101,272
Tax Exp 9,022 11,854 20,875 26,162
Tax rate 24% 24% 28% 26%
CAPEX 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Purchase of Fixed asset 32,725 35,449 32,792 24,686 32,524 47,280 52,846 59,067 66,020 73,793
Revenue 432,159 432,718 492,950 570,615 669,247 748,033 836,093 934,521 1,044,535 1,167,501
% of Sale 8% 8% 7% 4% 5%
Average 6%

Long term growth rate 7%


CMP 6552.08 Beta Calculation
Diluted Shares 302.08 Regression Beta 1.0
Market Cap 1,979,252 Average D/E 0.00
Long term Liabilities+ short term 4,836 Unlevered Beta 1.0
Cash and Cash equivalents 227 Levered Beta 1.0
Net Debt 4,609
Enterprise Value 1,983,861

Weightage COD
Debt to Capital 0.2% Interest Rate 18.5%
Equtiy to Captial 99.8% After tax COD 13.7%
Debt to Equity 0.0023
Debt to Equity 0.0000 WACC 9.3%

COE Calculation Calculated Enterprise Value Amt in Rs


Beta of Stock 1.0 Sum of PV of FCFF INR 452,845
RFR 7% Terminal Value 2,642,036
Implied market return in india 9.3% PV of Terminal Value INR 1,690,073
Market Risk Premium of India 1.8% Enterprise Value INR 2,142,918
Cost of Equity 9.3% Less- Debt 4,609
Add-Cash 227
Intrinsic Value Equity Value 2,138,536
Equity Value 2,138,536 Terminal Value as % of TV 79%
Diluted Shares 302.08
Intrinsic Value 7,079
Valuation UNDERVALUED CMP is lower the intrinsic value
Discount / ( Premium ) 527

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