Question: Take the data below of a startup firm. All number in Millions and assumptions in brackets. Calculate the NPV using Discounted Cash flow technique with 3 year projections. Hint: You should first create a table for 3 years with the free cash flow calculation and then use the formulaes for deriving NPV. (Create FCF calculation table and separately show for NPV calculation) EBIT: End of Year-1, Rs. 100 (Assume future growth rate- 10%). Interest: Rs. 10 (Existing loan Rs. 100 @10% interest rates, no new loan) Net Working capital: Rs. 10 per year (assume constant) • Taxes -30% (Assume Constant) Assets - Rs. 100 (Depreciation rate 20% per year) • Net Capital expenditure planned Rs. 20 each in the 2nd year and 3rd year Assume 2% terminal growth rate Assume 10% Weighted Average Cost of Capital ( WACC)

Chemistry
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Author:Steven S. Zumdahl, Susan A. Zumdahl, Donald J. DeCoste
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Chapter1: Chemical Foundations
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Question: Take the data below of a startup firm. All number in Millions and assumptions in brackets. Calculate the NPV
using Discounted Cash flow technique with 3 year projections. Hint: You should first create a table for 3 years with the
free cash flow calculation and then use the formulaes for deriving NPV. (Create FCF calculation table and separately
show for NPV calculation) EBIT: End of Year-1, Rs. 100 (Assume future growth rate- 10%). Interest: Rs. 10 (Existing
loan Rs. 100 @10% interest rates, no new loan) Net Working capital: Rs. 10 per year (assume constant) • Taxes
-30% (Assume Constant) Assets - Rs. 100 (Depreciation rate 20% per year) • Net Capital expenditure planned Rs. 20
each in the 2nd year and 3rd year Assume 2% terminal growth rate Assume 10% Weighted Average Cost of Capital (
WACC)
Transcribed Image Text:Question: Take the data below of a startup firm. All number in Millions and assumptions in brackets. Calculate the NPV using Discounted Cash flow technique with 3 year projections. Hint: You should first create a table for 3 years with the free cash flow calculation and then use the formulaes for deriving NPV. (Create FCF calculation table and separately show for NPV calculation) EBIT: End of Year-1, Rs. 100 (Assume future growth rate- 10%). Interest: Rs. 10 (Existing loan Rs. 100 @10% interest rates, no new loan) Net Working capital: Rs. 10 per year (assume constant) • Taxes -30% (Assume Constant) Assets - Rs. 100 (Depreciation rate 20% per year) • Net Capital expenditure planned Rs. 20 each in the 2nd year and 3rd year Assume 2% terminal growth rate Assume 10% Weighted Average Cost of Capital ( WACC)
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