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Module 3 Chapter 15 DCF Model

The document outlines a discounted cash flow model valuation for a company using 3 years of historical free cash flow data, growth rate assumptions, a discount rate, and terminal growth rate to calculate an intrinsic value range between INR 331.8 to 405.5 per share. Key inputs to the model include a 18%/10% FCF growth rate for the first 5/last 5 years, a 3.5% terminal growth rate, and a 9% discount rate applied to the projected future cash flows.

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Maulik Jain
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86 views

Module 3 Chapter 15 DCF Model

The document outlines a discounted cash flow model valuation for a company using 3 years of historical free cash flow data, growth rate assumptions, a discount rate, and terminal growth rate to calculate an intrinsic value range between INR 331.8 to 405.5 per share. Key inputs to the model include a 18%/10% FCF growth rate for the first 5/last 5 years, a 3.5% terminal growth rate, and a 9% discount rate applied to the projected future cash flows.

Uploaded by

Maulik Jain
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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The Discounted Cash Flow (DCF) Model

Module 3, Chapter 15
Version 1.0

Free Cash Flow Estimate (In INR Crs)


2011 - 12 2012 - 13 2013 - 14
Net cash from Operating Activities 296.3 335.4 278.7
Capital Expenditures 86.6 72.5 330.3
Free Cash Flow (FCF) 209.7 262.9 (51.6)
3 Year Average Free Cash flow 140.3

Inputs Cash flow & Present Value Table


Number of years considered 10 Sl No
FCF Growth rate for first 5 years 18% 1
FCF Growth rate for last 5 years 10% 2
Terminal Growth Rate 3.50% 3
Discount Rate 9% 4
5
Intrinsic Value Calculation (INR Crs, unless indicated) 6
Total PV of cash flow 6,078.68 7
Total Debt 75.94 8
Cash & Cash Balance 294.50 9
Net Debt (218.56) 10
Share Capital 17.08
Face Value (INR) 1.00 Terminal Year
Number of Shares 170,810,000 Terminal Value
Share Price (INR) 368.67 PV of Terminal Value

Intrinsic Value Band


Model Error leeway 10%
Lower Intrinsic value band 331.8
Upper Intrinsic value band 405.5

Disclaimer – This DCF model is for educational purpose only.


ash flow & Present Value Table
Year Cash flow f Cash flow
2014 - 15 165.61 151.93
2015 - 16 195.41 164.48
2016 - 17 230.59 178.06
2017 - 18 272.09 192.76
2018 - 19 321.07 208.67
2019 - 20 353.18 210.59
2020 - 21 388.50 212.52
2021 - 22 427.35 214.47
2022 - 23 470.08 216.44
2023 - 24 517.09 218.42

erminal Year 2023 - 24


erminal Value 9,730.67
V of Terminal Value 4,110.34

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