Description
The spreadsheet showing the workings of the case "Associate Bearings Company Limited".
Calculation of the Cost of Debt of ABCL Ltd.
Year 1980 1981 1982 1983 1984 Interest Paid 0.54 1.09 1.79 2.13 3.08 Long term debt 4.11 7.89 8.5 9.74 20.02 Short term debt 1.9 2.26 4.51 12.88 9.11 Total debt 6.01 10.15 13.01 22.62 29.13 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) Average Cost of Debt Average Cost of Debt ( in % )
1985 2.66 18.08 8.03 26.11
5.84% 0.068965 6.89%
6.98%
8.94%
6.12%
6.87%
6.62%
Cost of Equity based on DGM Year 1980 1981 1982 1983 1984 1985 EPS 41.17 49.34 51.68 48.45 57.45 60.51 DPS 17 20 20 20 20 22 PAT 3.63 4.35 4.56 4.28 5.07 5.34 Share Capital 8.82 8.82 8.82 8.82 8.82 8.82 Reserves 8.11 10.7 13.5 16.01 18.6 22 Net Worth 16.93 19.52 22.32 24.83 27.42 30.82 Market Value -High 432.5 412.5 450 398.75 465 785 Market Value -Low 205 302.5 375 317.5 362.5 442.5 Market Value -Avg 18.75 3 357.5 412.5 358.125 413.75 613.75 DPSt+1 /Pt 0.062745 0.055944 0.048485 0.055846 0.053172 0.039797844 Div pay out ratio (DPS/EPS) 0.412922 0.405351 0.386997 0.412797 0.348129 0.363576268 Retention Ratio = b = (1-Div Pay out Ratio) 0.587078 0.594649 0.613003 0.587203 0.651871 0.636423732 Return on Equity (PAT/Net 0.214412 0.222848 0.204301 0.172372 0.184902 0.173264114
g( b * r) 0.125877 0.132517 0.125237 0.101217 0.120532 0.110269394 Ke 0.188622 0.188461 0.173722 0.157064 0.173704 0.150067238 Average Ke 0.17194 Average Ke ( in % ) 17.20%
Calculation of Ke based on CAPM Calculation of Market rate of return: ABCL's cummulative monthly returns 0.200670695 0.061693569 0.09763847 -0.023530497 0.003960401 0.167054085 0.0584582 0 -0.028801991
Year
Month Sept Oct Nov 1980 Dec 1981 Jan Feb Mar Apr May
High 245 295 300 335 325 330 407.5 412.5 407.5
Low 205 255 285 310 305 302.5 340 380 385
Average Market 225 162.4 275 156.1 292.5 157.2 322.5 166.7 315 170.9 316.25 172.1 373.75 178.2 396.25 186.7 396.25 190.5
Jun Jul Aug Sep Oct Nov Dec 1982 Jan Feb Mar Apr May Jun Jul
390 392.5 382.5 400 400 396.3 400 405 432.5 430 406 400 400 388.8
380 385 372.5 375 390 387.5 395 396.3 397.5 402.5 380 386.3 375 380
385 388.75 377.5 387.5 395 391.9 397.5 400.65 415 416.25 393 393.15 387.5 384.4
193.8 198.5 194.6 185.5 188.8 192.7 193 193.8 192.1 189.8 184 182.7 176.3 172.1
0.009693129 -0.029365895 0.02614528 0.019169916 -0.00787906 0.014188229 0.007893294 0.035190292 0.003007521 -0.057476429 0.000381607 -0.01447537 -0.008032172 -0.001692378
Aug Sep Oct Nov Dec 1983 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1984 Jan Feb Mar Apr May Jun Jul Aug Sep Oct
387.5 390 392.5 392.5 392.5 398.8 395 395 366.5 350 360 367.5 375 382.5 382.5 377.5 380 455 455 386.3 390 383.8 397.5 398.8 397.5 400 425
380 377.5 387.5 385 382.5 397.8 391.3 372.5 320 317.5 350 348.1 346.3 377.5 372.5 375 375 380 380 380 382.5 362.5 368.8 395 343.8 396.3 396.8
383.75 383.75 390 388.75 387.5 398.3 393.15 383.75 343.25 333.75 355 357.8 360.65 380 377.5 376.25 377.5 417.5 417.5 383.15 386.25 373.15 383.15 396.9 370.65 398.15 410.9
178.4 179.2 180.9 181 188 185.4 181.5 180.7 178 189.2 199.5 197.2 197.1 196.9 197 200.3 206.6 209.1 205.4 204.4 199.4 195.6 198.4 210.3 208.2 205.8 210.4
0 0.01615544 -0.003210276 -0.003220615 0.027489641 -0.013014272 -0.02419992 -0.111532254 -0.028066835 0.06172558 0.007856382 0.007933788 0.052263294 -0.006600684 -0.003316753 0.003316753 0.100713976 0 -0.085857987 0.008058271 -0.034504345 0.026446074 0.035257802 -0.068426139 0.071570598 0.031521057 -0.011381142
Nov Dec 1985 Jan Feb Mar Apr May Jun AVERAGE
410 465 450 452 525 605 580 625
402.5 405 442.5 442.5 445 500 565 567.5
406.25 435 446.25 447.25 485 552.5 572.5 596.25
209.2 212.4 223.3 231.3 244 264.7 283.2 319.4
0.068377297 0.025533302 0.002238389 0.081031169 0.130304542 0.035559302 0.040647307 0.017097538
Rm=Average Monthly cummulative Return of Market* 12 Rm= 0.142396 Rm= 0.142396 Covariance of Market and ABCL= 0.000508 Variance of Market= 0.001051 Calculation of ? ? = Covariance of Market and ABCL / Variance of the Market 0.483575 Calculation of Cost of Equity based on CAPM Model Assumption: The risk free rate of return i.e. Rf is assumed to be 5 % which is the rate of return from a 90 day treasury bill. Rf Ke = Rf + (Rm-Rf)* ? Ke in % 0.05 0.09468 9.50%
Market's Cummulative monthly Return -0.0395656 0.007022052 0.05867691 0.0248828 0.006997113 0.034830812 0.046596536 0.020149144 0.017174505
0.023962401 -0.01984293 -0.047891288 0.017633372 0.020446322 0.001555613 0.004136511 -0.00881063 -0.012045184 -0.031035129 -0.007090294 -0.035658374 -0.024111386 0.035952517
0.00447428 0.009441892 0.000552639 0.037944932 -0.01392631 -0.021259999 -0.004417456 -0.015054647 0.061021106 0.05300958 -0.011595794 -0.000507228 -0.001015229 0.000507743 0.016612514 0.030968314 0.01202805 -0.017853309 -0.004880439 -0.024766001 -0.0192411 0.014213437 0.058249888 -0.010035927 -0.011594333 0.022105657 -0.005719749
0.015180557 0.050044869 0.03519941 0.053452656 0.081428884 0.067556253 0.120290874 0.011866348
Calculation of WACC Year Share Capital Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
1980 1981 8.82 8.82 8.11 10.7 16.93 19.52 4.11 7.89 1.9 2.26 6.01 10.15 0.738012206 0.6579 0.405259609 0.53506 23.64 17.83833333 0.569936111 0.430063889 0.172 0.069 0.127703419 12.78%
1982 1983 1984 1985 8.82 8.82 8.82 8.82 13.5 16.01 18.6 22 22.32 24.83 27.42 30.82 8.5 9.74 20.02 18.08 4.51 12.88 9.11 8.03 13.01 22.62 29.13 26.11 0.63176 0.523288 0.484881 0.541367 0.59597 0.719466 0.767589 0.747495
BIMETAL EPS DPS Share Capital Reserves Net Worth PAT Market Value High Low Average DPSt+1 /Pt Div pay out ratio (DPS/EPS) Retention Ratio = b = (1-Div Pay out Ratio) Return on Equity , r(PAT/Net Worth) g( b * r) Ke Average Ke ( based on DGM ) Average Ke ( in % )
1980 4.94 2.7 1.27 2.25 3.52 0.63
1981 7.69 2.7 1.27 2.88 4.15 0.98
1982 9.44 1.8 1.91 3.8 5.71 1.81
1983 7.48 2 1.91 4.85 6.76 1.43
1984 3.98 1.8 1.91 5.27 7.18 0.76
1985 7.24 2.1 1.91 6.25 8.16 1.38
50 49 36 39.5 43 90 32 38 25 28 34 38 41 43.5 30.5 33.75 38.5 64 0.065854 0.041379 0.065574 0.053333 0.054545 0.036752 0.546559 0.351105 0.190678 0.26738 0.452261 0.290055 0.453441 0.648895 0.809322 0.73262 0.547739 0.709945
0.178977 0.236145 0.316988 0.211538 0.10585 0.169118 0.081156 0.153233 0.256545 0.154977 0.057978 0.120064 0.147009 0.194612 0.322119 0.208311 0.112523 0.156816 0.190232 19%
ANTIFRICTION EPS DPS Share Capital Reserves Net Worth PAT Market Value High Low Average DPSt+1 /Pt Div pay out ratio (DPS/EPS) Retention Ratio = b = (1-Div Pay out Ratio) Return on Equity , r(PAT/Net Worth) g( b * r) Ke Average Ke ( based on DGM ) Average Ke ( in % )
1980 10.94 1.7 1.47 3.42 4.89 1.63
1981 5.97 1.7 1.47 4.24 5.71 0.93
1982 2.94 1.4 2.2 3.85 6.05 0.7
1983 3.61 1.4 2.2 4.33 6.53 0.85
1984 0.23 1.4 2.2 4.03 6.23 0.05
1985 0.67 1 2.2 3.95 6.15 0.2
46.5 50 30 28.5 27 50 30 28 20.5 8.5 23.5 21 38.25 39 25.25 18.5 25.25 35.5 0.044444 0.035897 0.055446 0.075676 0.039604 0.027718 0.155393 0.284757 0.47619 0.387812 6.086957 1.492537 0.844607 0.715243 0.52381 0.612188 -5.08696 -0.49254 0.03252 -0.01602 0.0117
0.333333 0.162872 0.115702 0.130168 0.008026 0.281536 0.116493 0.060606 0.079688 -0.04083 0.32598 0.152391 0.116052 0.155363 -0.00122 0.126711 12.67
FAG PRECISION EPS DPS Share Capital Reserves Net Worth PAT Market Value High Low Average DPSt+1 /Pt Div pay out ratio (DPS/EPS) Retention Ratio = b = (1-Div Pay out Ratio) Return on Equity , r(PAT/Net Worth) g( b * r) Ke Average Ke ( based on DGM ) Average Ke ( in % )
1980 45.03 10 1.67 2.73 4.4 0.75
1981 34.88 13 1.67 3.1 4.77 0.58
1982 -43.26 0 1.67 2.38 4.05 -0.72
1983 -15.44 0 1.67 2.12 3.79 -0.26
1984 31.81 12 1.67 2.45 4.12 0.53
1985 70.5 14 1.67 3.39 5.06 1.18
152 165 106 130 129 147.5 0.100775 0 0.222074 0.372706 0.777926 0.627294 0.170455 0.121593 0.132601 0.076275 0.233376 0.076275 0.119978 12
177 110 143.5 0 0 1
114 112.5 225 74 62 102.5 94 87.25 163.75 0.12766 0.160458 0.101475 0 0.37724 0.198582 1 0.62276 0.801418
-0.17778 -0.0686 0.128641 0.233202 -0.17778 -0.0686 0.080112 0.186892 -0.17778 0.059058 0.240571 0.288367
Year 1980 1981 1982 1983 Interest Paid 0.11 0.12 0.46 0.58 Long term debt 0.8 1.08 2.99 3.39 Short term debt 0 0.32 0 1.57 Total debt 0.8 1.4 2.99 4.96 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) 8.94% 5.57% 10.00% 7.60% Average Cost of Debt 0.077912 Average Cost of Debt ( in % ) 7.79% For 1986 DPS = DPS of 1985 * (1+g of 1985) 2.352135
1984 0.75 1.9 5.17 7.07
1985 0.91 1.99 5.65 7.64
6.90%
7.74%
Year 1980 1981 1982 1983 Interest Paid 0.57 0.9 1 1.23 Long term debt 3.23 3.59 3.63 5.04 Short term debt 2.63 2.78 2.75 4.05 Total debt 5.86 6.37 6.38 9.09 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) 6.32% 9.18% 10.19% 8.80% Average Cost of Debt 0.09091 Average Cost of Debt ( in % ) 9.09% For 1986 DPS = DPS of 1985 * (1+g of 1985) 0.983983
1984 1.83 5.53 5.78 11.31
1985 1.83 5.95 6.52 12.47
10.52%
9.54%
Year 1980 1981 1982 1983 Interest Paid 0.6 0.71 1.82 1.53 Long term debt 0.96 3.46 4.62 5.69 Short term debt 3.02 4.02 5.61 4.47 Total debt 3.98 7.48 10.23 10.16 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) 9.80% 6.17% 11.56% 9.79% Average Cost of Debt 0.093656 Average Cost of Debt ( in % ) 9.36% For 1986 DPS = DPS of 1985 * (1+g of 1985) 16.61649
1984 1.64 6.34 5.51 11.85
1985 1.79 5.26 6.52 11.78
9.00%
9.88%
Calculation of WACC BIMETAL Year Share Capital Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
1980 1981 1982 1983 1.27 1.27 1.91 1.91 2.25 2.88 3.8 4.85 3.52 4.15 5.71 6.76 0.8 1.08 2.99 3.39 0 0.32 0 1.57 0.8 1.4 2.99 4.96 0.814815 0.747748 0.656322 0.576792 0.185185 0.252252 0.343678 0.423208 5.913333 4.143333 0.588001 0.411999 0.068965 0.17194 0.111391 11.14%
1984 1.91 5.27 7.18 1.9 5.17 7.07 0.50386 0.49614
ANTI FRICTION Year Share Capital Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
1980 1981 1982 1983 1984 1.47 1.47 2.2 2.2 2.2 3.42 4.24 3.85 4.33 4.03 4.89 5.71 6.05 6.53 6.23 3.23 3.59 3.63 5.04 5.53 2.63 2.78 2.75 4.05 5.78 5.86 6.37 6.38 9.09 11.31 0.454884 0.472682 0.486726 0.418054 0.355188 0.799454 0.8125 0.74359 0.805137 0.837158 5.926667 8.58 0.408548 0.591452 0.126711 0.09091 0.111391 10.55%
FAG PRECISION Year Share Capital
1980 1.67
1981 1.67
1982 1.67
1983 1.67
1984 1.67
Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
2.73 3.1 2.38 2.12 2.45 4.4 4.77 4.05 3.79 4.12 0.96 3.46 4.62 5.69 6.34 3.02 4.02 5.61 4.47 5.51 3.98 7.48 10.23 10.16 11.85 0.52506 0.389388 0.283613 0.271685 0.257984 0.704425 0.817486 0.859664 0.858833 0.876479 4.365 9.246667 0.320681 0.679319 0.119978 0.093656 0.102097 10.21%
1985 1.91 6.25 8.16 1.99 5.65 7.64 0.516456 0.483544
1985 2.2 3.95 6.15 5.95 6.52 12.47 0.33029 0.850034
1985 1.67
3.39 5.06 5.26 6.52 11.78 0.300475 0.875836
doc_122678259.xls
The spreadsheet showing the workings of the case "Associate Bearings Company Limited".
Calculation of the Cost of Debt of ABCL Ltd.
Year 1980 1981 1982 1983 1984 Interest Paid 0.54 1.09 1.79 2.13 3.08 Long term debt 4.11 7.89 8.5 9.74 20.02 Short term debt 1.9 2.26 4.51 12.88 9.11 Total debt 6.01 10.15 13.01 22.62 29.13 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) Average Cost of Debt Average Cost of Debt ( in % )
1985 2.66 18.08 8.03 26.11
5.84% 0.068965 6.89%
6.98%
8.94%
6.12%
6.87%
6.62%
Cost of Equity based on DGM Year 1980 1981 1982 1983 1984 1985 EPS 41.17 49.34 51.68 48.45 57.45 60.51 DPS 17 20 20 20 20 22 PAT 3.63 4.35 4.56 4.28 5.07 5.34 Share Capital 8.82 8.82 8.82 8.82 8.82 8.82 Reserves 8.11 10.7 13.5 16.01 18.6 22 Net Worth 16.93 19.52 22.32 24.83 27.42 30.82 Market Value -High 432.5 412.5 450 398.75 465 785 Market Value -Low 205 302.5 375 317.5 362.5 442.5 Market Value -Avg 18.75 3 357.5 412.5 358.125 413.75 613.75 DPSt+1 /Pt 0.062745 0.055944 0.048485 0.055846 0.053172 0.039797844 Div pay out ratio (DPS/EPS) 0.412922 0.405351 0.386997 0.412797 0.348129 0.363576268 Retention Ratio = b = (1-Div Pay out Ratio) 0.587078 0.594649 0.613003 0.587203 0.651871 0.636423732 Return on Equity (PAT/Net 0.214412 0.222848 0.204301 0.172372 0.184902 0.173264114
g( b * r) 0.125877 0.132517 0.125237 0.101217 0.120532 0.110269394 Ke 0.188622 0.188461 0.173722 0.157064 0.173704 0.150067238 Average Ke 0.17194 Average Ke ( in % ) 17.20%
Calculation of Ke based on CAPM Calculation of Market rate of return: ABCL's cummulative monthly returns 0.200670695 0.061693569 0.09763847 -0.023530497 0.003960401 0.167054085 0.0584582 0 -0.028801991
Year
Month Sept Oct Nov 1980 Dec 1981 Jan Feb Mar Apr May
High 245 295 300 335 325 330 407.5 412.5 407.5
Low 205 255 285 310 305 302.5 340 380 385
Average Market 225 162.4 275 156.1 292.5 157.2 322.5 166.7 315 170.9 316.25 172.1 373.75 178.2 396.25 186.7 396.25 190.5
Jun Jul Aug Sep Oct Nov Dec 1982 Jan Feb Mar Apr May Jun Jul
390 392.5 382.5 400 400 396.3 400 405 432.5 430 406 400 400 388.8
380 385 372.5 375 390 387.5 395 396.3 397.5 402.5 380 386.3 375 380
385 388.75 377.5 387.5 395 391.9 397.5 400.65 415 416.25 393 393.15 387.5 384.4
193.8 198.5 194.6 185.5 188.8 192.7 193 193.8 192.1 189.8 184 182.7 176.3 172.1
0.009693129 -0.029365895 0.02614528 0.019169916 -0.00787906 0.014188229 0.007893294 0.035190292 0.003007521 -0.057476429 0.000381607 -0.01447537 -0.008032172 -0.001692378
Aug Sep Oct Nov Dec 1983 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1984 Jan Feb Mar Apr May Jun Jul Aug Sep Oct
387.5 390 392.5 392.5 392.5 398.8 395 395 366.5 350 360 367.5 375 382.5 382.5 377.5 380 455 455 386.3 390 383.8 397.5 398.8 397.5 400 425
380 377.5 387.5 385 382.5 397.8 391.3 372.5 320 317.5 350 348.1 346.3 377.5 372.5 375 375 380 380 380 382.5 362.5 368.8 395 343.8 396.3 396.8
383.75 383.75 390 388.75 387.5 398.3 393.15 383.75 343.25 333.75 355 357.8 360.65 380 377.5 376.25 377.5 417.5 417.5 383.15 386.25 373.15 383.15 396.9 370.65 398.15 410.9
178.4 179.2 180.9 181 188 185.4 181.5 180.7 178 189.2 199.5 197.2 197.1 196.9 197 200.3 206.6 209.1 205.4 204.4 199.4 195.6 198.4 210.3 208.2 205.8 210.4
0 0.01615544 -0.003210276 -0.003220615 0.027489641 -0.013014272 -0.02419992 -0.111532254 -0.028066835 0.06172558 0.007856382 0.007933788 0.052263294 -0.006600684 -0.003316753 0.003316753 0.100713976 0 -0.085857987 0.008058271 -0.034504345 0.026446074 0.035257802 -0.068426139 0.071570598 0.031521057 -0.011381142
Nov Dec 1985 Jan Feb Mar Apr May Jun AVERAGE
410 465 450 452 525 605 580 625
402.5 405 442.5 442.5 445 500 565 567.5
406.25 435 446.25 447.25 485 552.5 572.5 596.25
209.2 212.4 223.3 231.3 244 264.7 283.2 319.4
0.068377297 0.025533302 0.002238389 0.081031169 0.130304542 0.035559302 0.040647307 0.017097538
Rm=Average Monthly cummulative Return of Market* 12 Rm= 0.142396 Rm= 0.142396 Covariance of Market and ABCL= 0.000508 Variance of Market= 0.001051 Calculation of ? ? = Covariance of Market and ABCL / Variance of the Market 0.483575 Calculation of Cost of Equity based on CAPM Model Assumption: The risk free rate of return i.e. Rf is assumed to be 5 % which is the rate of return from a 90 day treasury bill. Rf Ke = Rf + (Rm-Rf)* ? Ke in % 0.05 0.09468 9.50%
Market's Cummulative monthly Return -0.0395656 0.007022052 0.05867691 0.0248828 0.006997113 0.034830812 0.046596536 0.020149144 0.017174505
0.023962401 -0.01984293 -0.047891288 0.017633372 0.020446322 0.001555613 0.004136511 -0.00881063 -0.012045184 -0.031035129 -0.007090294 -0.035658374 -0.024111386 0.035952517
0.00447428 0.009441892 0.000552639 0.037944932 -0.01392631 -0.021259999 -0.004417456 -0.015054647 0.061021106 0.05300958 -0.011595794 -0.000507228 -0.001015229 0.000507743 0.016612514 0.030968314 0.01202805 -0.017853309 -0.004880439 -0.024766001 -0.0192411 0.014213437 0.058249888 -0.010035927 -0.011594333 0.022105657 -0.005719749
0.015180557 0.050044869 0.03519941 0.053452656 0.081428884 0.067556253 0.120290874 0.011866348
Calculation of WACC Year Share Capital Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
1980 1981 8.82 8.82 8.11 10.7 16.93 19.52 4.11 7.89 1.9 2.26 6.01 10.15 0.738012206 0.6579 0.405259609 0.53506 23.64 17.83833333 0.569936111 0.430063889 0.172 0.069 0.127703419 12.78%
1982 1983 1984 1985 8.82 8.82 8.82 8.82 13.5 16.01 18.6 22 22.32 24.83 27.42 30.82 8.5 9.74 20.02 18.08 4.51 12.88 9.11 8.03 13.01 22.62 29.13 26.11 0.63176 0.523288 0.484881 0.541367 0.59597 0.719466 0.767589 0.747495
BIMETAL EPS DPS Share Capital Reserves Net Worth PAT Market Value High Low Average DPSt+1 /Pt Div pay out ratio (DPS/EPS) Retention Ratio = b = (1-Div Pay out Ratio) Return on Equity , r(PAT/Net Worth) g( b * r) Ke Average Ke ( based on DGM ) Average Ke ( in % )
1980 4.94 2.7 1.27 2.25 3.52 0.63
1981 7.69 2.7 1.27 2.88 4.15 0.98
1982 9.44 1.8 1.91 3.8 5.71 1.81
1983 7.48 2 1.91 4.85 6.76 1.43
1984 3.98 1.8 1.91 5.27 7.18 0.76
1985 7.24 2.1 1.91 6.25 8.16 1.38
50 49 36 39.5 43 90 32 38 25 28 34 38 41 43.5 30.5 33.75 38.5 64 0.065854 0.041379 0.065574 0.053333 0.054545 0.036752 0.546559 0.351105 0.190678 0.26738 0.452261 0.290055 0.453441 0.648895 0.809322 0.73262 0.547739 0.709945
0.178977 0.236145 0.316988 0.211538 0.10585 0.169118 0.081156 0.153233 0.256545 0.154977 0.057978 0.120064 0.147009 0.194612 0.322119 0.208311 0.112523 0.156816 0.190232 19%
ANTIFRICTION EPS DPS Share Capital Reserves Net Worth PAT Market Value High Low Average DPSt+1 /Pt Div pay out ratio (DPS/EPS) Retention Ratio = b = (1-Div Pay out Ratio) Return on Equity , r(PAT/Net Worth) g( b * r) Ke Average Ke ( based on DGM ) Average Ke ( in % )
1980 10.94 1.7 1.47 3.42 4.89 1.63
1981 5.97 1.7 1.47 4.24 5.71 0.93
1982 2.94 1.4 2.2 3.85 6.05 0.7
1983 3.61 1.4 2.2 4.33 6.53 0.85
1984 0.23 1.4 2.2 4.03 6.23 0.05
1985 0.67 1 2.2 3.95 6.15 0.2
46.5 50 30 28.5 27 50 30 28 20.5 8.5 23.5 21 38.25 39 25.25 18.5 25.25 35.5 0.044444 0.035897 0.055446 0.075676 0.039604 0.027718 0.155393 0.284757 0.47619 0.387812 6.086957 1.492537 0.844607 0.715243 0.52381 0.612188 -5.08696 -0.49254 0.03252 -0.01602 0.0117
0.333333 0.162872 0.115702 0.130168 0.008026 0.281536 0.116493 0.060606 0.079688 -0.04083 0.32598 0.152391 0.116052 0.155363 -0.00122 0.126711 12.67
FAG PRECISION EPS DPS Share Capital Reserves Net Worth PAT Market Value High Low Average DPSt+1 /Pt Div pay out ratio (DPS/EPS) Retention Ratio = b = (1-Div Pay out Ratio) Return on Equity , r(PAT/Net Worth) g( b * r) Ke Average Ke ( based on DGM ) Average Ke ( in % )
1980 45.03 10 1.67 2.73 4.4 0.75
1981 34.88 13 1.67 3.1 4.77 0.58
1982 -43.26 0 1.67 2.38 4.05 -0.72
1983 -15.44 0 1.67 2.12 3.79 -0.26
1984 31.81 12 1.67 2.45 4.12 0.53
1985 70.5 14 1.67 3.39 5.06 1.18
152 165 106 130 129 147.5 0.100775 0 0.222074 0.372706 0.777926 0.627294 0.170455 0.121593 0.132601 0.076275 0.233376 0.076275 0.119978 12
177 110 143.5 0 0 1
114 112.5 225 74 62 102.5 94 87.25 163.75 0.12766 0.160458 0.101475 0 0.37724 0.198582 1 0.62276 0.801418
-0.17778 -0.0686 0.128641 0.233202 -0.17778 -0.0686 0.080112 0.186892 -0.17778 0.059058 0.240571 0.288367
Year 1980 1981 1982 1983 Interest Paid 0.11 0.12 0.46 0.58 Long term debt 0.8 1.08 2.99 3.39 Short term debt 0 0.32 0 1.57 Total debt 0.8 1.4 2.99 4.96 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) 8.94% 5.57% 10.00% 7.60% Average Cost of Debt 0.077912 Average Cost of Debt ( in % ) 7.79% For 1986 DPS = DPS of 1985 * (1+g of 1985) 2.352135
1984 0.75 1.9 5.17 7.07
1985 0.91 1.99 5.65 7.64
6.90%
7.74%
Year 1980 1981 1982 1983 Interest Paid 0.57 0.9 1 1.23 Long term debt 3.23 3.59 3.63 5.04 Short term debt 2.63 2.78 2.75 4.05 Total debt 5.86 6.37 6.38 9.09 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) 6.32% 9.18% 10.19% 8.80% Average Cost of Debt 0.09091 Average Cost of Debt ( in % ) 9.09% For 1986 DPS = DPS of 1985 * (1+g of 1985) 0.983983
1984 1.83 5.53 5.78 11.31
1985 1.83 5.95 6.52 12.47
10.52%
9.54%
Year 1980 1981 1982 1983 Interest Paid 0.6 0.71 1.82 1.53 Long term debt 0.96 3.46 4.62 5.69 Short term debt 3.02 4.02 5.61 4.47 Total debt 3.98 7.48 10.23 10.16 Tax rate = 35 % --- Assumed since the tax rate from PAT is variable which is not possible Tax rate 0.35 Cost of debt ( in% ) (Interest * (1-Tax rate)/Total Debt) 9.80% 6.17% 11.56% 9.79% Average Cost of Debt 0.093656 Average Cost of Debt ( in % ) 9.36% For 1986 DPS = DPS of 1985 * (1+g of 1985) 16.61649
1984 1.64 6.34 5.51 11.85
1985 1.79 5.26 6.52 11.78
9.00%
9.88%
Calculation of WACC BIMETAL Year Share Capital Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
1980 1981 1982 1983 1.27 1.27 1.91 1.91 2.25 2.88 3.8 4.85 3.52 4.15 5.71 6.76 0.8 1.08 2.99 3.39 0 0.32 0 1.57 0.8 1.4 2.99 4.96 0.814815 0.747748 0.656322 0.576792 0.185185 0.252252 0.343678 0.423208 5.913333 4.143333 0.588001 0.411999 0.068965 0.17194 0.111391 11.14%
1984 1.91 5.27 7.18 1.9 5.17 7.07 0.50386 0.49614
ANTI FRICTION Year Share Capital Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
1980 1981 1982 1983 1984 1.47 1.47 2.2 2.2 2.2 3.42 4.24 3.85 4.33 4.03 4.89 5.71 6.05 6.53 6.23 3.23 3.59 3.63 5.04 5.53 2.63 2.78 2.75 4.05 5.78 5.86 6.37 6.38 9.09 11.31 0.454884 0.472682 0.486726 0.418054 0.355188 0.799454 0.8125 0.74359 0.805137 0.837158 5.926667 8.58 0.408548 0.591452 0.126711 0.09091 0.111391 10.55%
FAG PRECISION Year Share Capital
1980 1.67
1981 1.67
1982 1.67
1983 1.67
1984 1.67
Reserves Total Equity Long term debt Short term debt Total debt Equity weightage Debt weightage Avg Equity Avg Debt Equity weightage (Xe) Debt weightage (Xd) Cost of Equity ( based on DGM ) Cost of Debt WAAC = ( Xe * Ke + Xd * Kd ) WAAC = ( Xe * Ke + Xd * Kd ) in %
2.73 3.1 2.38 2.12 2.45 4.4 4.77 4.05 3.79 4.12 0.96 3.46 4.62 5.69 6.34 3.02 4.02 5.61 4.47 5.51 3.98 7.48 10.23 10.16 11.85 0.52506 0.389388 0.283613 0.271685 0.257984 0.704425 0.817486 0.859664 0.858833 0.876479 4.365 9.246667 0.320681 0.679319 0.119978 0.093656 0.102097 10.21%
1985 1.91 6.25 8.16 1.99 5.65 7.64 0.516456 0.483544
1985 2.2 3.95 6.15 5.95 6.52 12.47 0.33029 0.850034
1985 1.67
3.39 5.06 5.26 6.52 11.78 0.300475 0.875836
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