Scribd Logo
Upload

Welcome to Scribd!

  • 96 views

    JHT Case Excel

    Uploaded by

    anup akashe
    1. JHT's SuperMud is a four year project with an initial investment of $169 million and net working capital of $9 million. It is expected to generate positive cash flows each year and have a salvage value of $65 million at the end of year 4. 2. Key financial metrics for the project include an IRR of 22.2%, NPV of $43.9 million including tax savings, and payback period of 4 years. 3. Operating cash flows are projected for years 1 through 4, showing increasing sales, costs, profits, and positive cash flows each year. Working capital requirements also increase each year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd

    JHT Case Excel

    Uploaded by

    anup akashe
    96 views4 pages
    1. JHT's SuperMud is a four year project with an initial investment of $169 million and net working capital of $9 million. It is expected to generate positive cash flows each year and have a salvage value of $65 million at the end of year 4. 2. Key financial metrics for the project include an IRR of 22.2%, NPV of $43.9 million including tax savings, and payback period of 4 years. 3. Operating cash flows are projected for years 1 through 4, showing increasing sales, costs, profits, and positive cash flows each year. Working capital requirements also increase each year.

    Original Description:

    excel case soln

    Original Title

    JHT Case excel

    Copyright

    © © All Rights Reserved

    Available Formats

    XLSX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    1. JHT's SuperMud is a four year project with an initial investment of $169 million and net working capital of $9 million. It is expected to generate positive cash flows each year and have a salvage value of $65 million at the end of year 4. 2. Key financial metrics for the project include an IRR of 22.2%, NPV of $43.9 million including tax savings, and payback period of 4 years. 3. Operating cash flows are projected for years 1 through 4, showing increasing sales, costs, profits, and positive cash flows each year. Working capital requirements also increase each year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    96 views4 pages

    JHT Case Excel

    Uploaded by

    anup akashe
    1. JHT's SuperMud is a four year project with an initial investment of $169 million and net working capital of $9 million. It is expected to generate positive cash flows each year and have a salvage value of $65 million at the end of year 4. 2. Key financial metrics for the project include an IRR of 22.2%, NPV of $43.9 million including tax savings, and payback period of 4 years. 3. Operating cash flows are projected for years 1 through 4, showing increasing sales, costs, profits, and positive cash flows each year. Working capital requirements also increase each year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 4

    JHT's SuperMud

    WACC
    Four Year System
    If project is sold after 4 years. Assuming Straight line depreciation
    Depreciation Rate (SL in Years) 7

    Initial Cashflow
    Initial Investment 160000000
    NWC 9000000
    Total 169000000

    Terminal CashFlow
    Actual Salvage Value 65000000
    WC recovered at project end 47636582.624
    TCF excluding PV of Tax Savings 112636582.62
    Discounted TCF exc PV of Tax Savings 68112566.88

    Operating Cashflows
    Particulars/Years 1 2
    Sales
    OEM Units 2728000 2796200
    OEM Price 41 43.46
    OEM Sales 111848000 121522852
    Replace Units 2560000 2611200
    Replace Price 62 65.72
    Replace Sales 158720000 171608064

    Total Units 5288000 5407400


    Total Sales Revenue 270568000 293130916
    Variable Costs
    Per Unit 29 30.74
    Total Variable Cost 153352000 166223476

    Gross Profit 117216000 126907440


    Sales and General Exp 43000000 45150000
    Depreciation 22857142.857 22857142.85714
    EBIT 51358857.143 58900297.14286
    Tax (40%) 20543542.857 23560118.85714

    EAT 30815314.286 35340178.28571


    Cashflow 53672457.143 58197321.14286

    WC 40585200 43969637.4
    Change In WC 31585200 3384437.4
    New Capital Investment 0 0
    Free Cash Flow from operation (cash at end of year 1) 22087257.143 54812883.74286
    Discounted Cash Flow (PV at end of year 1,2,3,4) 19477299.068 42624229.55595

    NPV excluding PV of Tax Savings 43439558.608


    NPV including PV of Tax Savings 43871494.95

    Capital Budgeting Criteria


    Payback 4
    Discounted Payback 4
    IRR 22.1854%
    NPV 43871494.95
    PI 1.2595946447
    MIRR 20.1353%

    0 1
    CF -169000000 22087257.14286
    DCF -169000000 19477299.06778
    Payback -146912742.8571
    Discounted Payback -149522700.9322
    Tax Rate 0.4
    Price Growth factor of inflation 1.05
    Cost of Capital 0.134
    Capital Gains Tax 0.2
    Inflation 0.05
    Price rise above inflation 0.01
    Tiers per Car 4
    New Cars 6200000
    New Car Tires 24800000
    JHT share in OEM 0.11
    JHT market year 1 2728000
    Growth in Market size 0.025

    Replace Market 32000000


    JHT share in replace market 0.08
    JHT replace market Year 1 2560000
    Growth in Market Size 0.02

    Depreciation 91428571.4285714
    Depreciated Value 68571428.5714286
    Salvage Value 65000000
    Capital Loss -3571428.57142857
    Tax Savings 714285.714285714
    PV of Tax savings 431936.34210111

    3 4

    2866105 2937757.625
    46.0676 48.831656
    132034578.698 143455569.755377
    2663424 2716692.48
    69.6632 73.842992
    185542638.7968 200608701.0671

    5529529 5654450.105
    317577217.4948 344064270.822477

    32.5844 34.539464
    180176384.7476 195301675.841444

    137400832.7472 148762594.981033
    47407500 49777875
    22857142.8571429 22857142.8571429
    67136189.8900571 76127577.1238906
    26854475.9560228 30451030.8495562

    40281713.9340343 45676546.2743344
    63138856.7911771 68533689.1314772

    47636582.62422 0
    3666945.22421999
    0 0
    59471911.5669571 68533689.1314772
    40782395.7127316 41443067.3918029

    2 3 4
    54812883.7428571 59471911.5669571 181884557.47
    42624229.5559546 40782395.7127316 109987570.6136
    -92099859.1142857 -32627947.5473286 149256609.9227
    -106898471.37627 -66116075.6635385 43871494.95003

    You might also like