Scribd
Upload
71 views8 pages

P20A SPMBV 2022 Syl

- The document provides financial information for a company including property, plant & equipment, investments, inventories, profit, capital employed, and goodwill values for fiscal years 2020-21 through 2022-23. - It also presents a scenario where Vikas Ltd wishes to acquire Nikas Ltd and provides financial details like earnings after tax, earnings per share, equity shares outstanding, and share price for both companies. - Vikas Ltd is considering three acquisition plans: paying 12.5 per share for Nikas shares, exchanging 25 cash and one Vikas share for every four Nikas shares, or exchanging one Vikas share for every two Nikas shares. The document asks to calculate EPS and share price

Uploaded by

Manish
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
71 views8 pages

P20A SPMBV 2022 Syl

- The document provides financial information for a company including property, plant & equipment, investments, inventories, profit, capital employed, and goodwill values for fiscal years 2020-21 through 2022-23. - It also presents a scenario where Vikas Ltd wishes to acquire Nikas Ltd and provides financial details like earnings after tax, earnings per share, equity shares outstanding, and share price for both companies. - Vikas Ltd is considering three acquisition plans: paying 12.5 per share for Nikas shares, exchanging 25 cash and one Vikas share for every four Nikas shares, or exchanging one Vikas share for every two Nikas shares. The document asks to calculate EPS and share price

Uploaded by

Manish
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 8

P-20A(SPMBV) (8)

Syllabus 2022

Additional Information:

(in crores)

FY 2022-23
Particulars FY 2020-21 FY 2021-22
*4,730.00
Fair Value of Property, Plant and Equipment * 3,850.00 *4,180.00
Fair Value of Investments 281.25 * 337.50
* 225.00

Fair Value of Inventories *2,262.50 * 2,253.45


* 1,945.75
Profit for the year *925.00 * 1,075.00
* 850.00

Normal Return on Capital Employed is 12.0% and the Capital Employed in the
beginning of FY 2020-21 is 4,850 crores.
If goodwill is calculated as 5 years' purchase based on average super profit, then
you are required to calculate Goodwill and Value of the business at the end of
10
FY 2022-23.

10. Vikas Ltd. wishes to acquire Nikas Ltd., a small company with good growth prospects.
The relevant information for both companies is as follows:
Company EAT () EPS (3)
Equity shares Outstanding Share price (3)
2
Vikas Ltd 10,00,000 25 20,00,000
2
Nikas Ltd 1,00,000 10 2,00,000

Vikas Ltd. is considering three different acquisition plans viz.,


(i) Pay 12.5 per share for each share of Nikas Ltd.
(ii) Exchange 25 cash and one share of Vikas Ltd for every four shares of Nikas Ltd.
(iii) Exchange one share for every two shares of Nikas Ltd.
Questions

(a) What will Vikas's Earning per share (EPS) be under each of the three plans?
(b) What will share prices of Vikas Ltd. be under each of the three plans, if its current
price earnings ratio remains unchanged?
(c) Formulate a strategy for Vikas Ltd to take over Nikas Ltd so that post merger Vikas
Ltd gets the best market valuation. 8

You might also like