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PV Calculations for Unlevered Cash Flows

The document calculates the value of a firm using the adjusted present value (APV) method in 5 steps: 1. It calculates the present value of unlevered free cash flows for the first 5 years totaling $8,243. 2. It calculates the present value of unlevered free cash flows beyond year 5 of $4,671. 3. It calculates the present value of interest tax shields for the first 5 years totaling $1,855. 4. It calculates the present value of interest tax shields beyond year 5 of $507. 5. It sums the above amounts to get the total firm value of $19,600. Therefore, the most the

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Frizky Putra
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15 views4 pages

PV Calculations for Unlevered Cash Flows

The document calculates the value of a firm using the adjusted present value (APV) method in 5 steps: 1. It calculates the present value of unlevered free cash flows for the first 5 years totaling $8,243. 2. It calculates the present value of unlevered free cash flows beyond year 5 of $4,671. 3. It calculates the present value of interest tax shields for the first 5 years totaling $1,855. 4. It calculates the present value of interest tax shields beyond year 5 of $507. 5. It sums the above amounts to get the total firm value of $19,600. Therefore, the most the

Uploaded by

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

Frizky Triputra C.

- 1706058792 KPL - Mini Case Chapter 18 - Page 571 RWJ

1. Calculate PV of unlevered CF for first 5 years


19 20 21 22
Depreciation 534 568 591 620
EBT 1686 1768 1953 1920
Tax (21%) 354.06 371.28 410.13 403.2
Net Income 1331.94 1396.72 1542.87 1516.8

Capital Expenditure 307 266 334 339


Delta NWC -134 -205 111 105
Asset Sales 1560 1131

Unlevered
CF 3252.94 3034.72 1688.87 1692.8

PV of Unlevered
CF 2853.456 2335.118 1139.939 1002.273

Total PV Unlevered CF 8243.235

2. Calculate PV of Unlevered CF beyond 5 years

Unlevered CF
Beyond 5 years (912,4 * (1 + 0,035)) / (0,14 - 0,035)
Unlevered CF
Beyond 5 years 8994.127

Terminal value today


PV UN CF B5y ( 8994,127 ) / (1,14)^5
PV UN CF B5y 4671.268

3. Calculate PV of interest tax shields for 5 yrs


19 20 21 22
Interest Payments 2120 2045 2851 2779

PV of tax shields = sigma( int payements * tax rate) / ytm^t

PV of tax shields 395.7333 339.3185 420.4932 364.3324


PV of tax shields 1854.916

4. Calculate PV of Interest Tax Shields beyond 5 years

MM II With Coorporate Tax


Rs = Ro + (B/S)(Ro-Rb)(1-tc)
Rs = 0,14 + 0,25 (0,14 - 0,08)(1-0,21)
Rs = 0.15185 or 15.19%
WACC = ( (B/(B+S)) * ( 1-tc) * Rb ) + ( S / (B+S) ) * Rs
WACC = 0.1341

VL = 1757 * (1 + 0,035) / (0,1336 - 0,035)


18345
VL = VU + TcB
18345 = 17317 + TcB
TcB = 1027
PV TcB 1027/1,1595 507

Value of the firm = PV of Unlevered Firm + PV of Interest Tax Shield


= 8243,23 + 8994,13 + 1855 + 507
19599.36

So, the most group should offer per share is:


Price = $19599,36 / 385
Price = 50.9074285714286 or ~ $51
pter 18 - Page 571 RWJ

metode apa dulu? Apv


23 wacc , fte (jika datanya cf tersedia untuk eq holder)
633 atau apv
1996 wacc = jika debt level ketahuan, pake APV
419.16
1576.84

334
119

1756.84

912.4476

23
2875

335.0384

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