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DCF Model: Free Cash Flow Analysis

The document summarizes a discounted cash flow valuation of a company. It provides estimated free cash flows from 2011-2014, inputs for the DCF model including growth rates and discount rate, and calculates an intrinsic value band of INR 331.8 to 405.5 per share based on a 10 year forecast and 3% terminal growth rate. A present value table shows the discounted future cash flows and terminal value.

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Avinash Ganesan
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298 views5 pages

DCF Model: Free Cash Flow Analysis

The document summarizes a discounted cash flow valuation of a company. It provides estimated free cash flows from 2011-2014, inputs for the DCF model including growth rates and discount rate, and calculates an intrinsic value band of INR 331.8 to 405.5 per share based on a 10 year forecast and 3% terminal growth rate. A present value table shows the discounted future cash flows and terminal value.

Uploaded by

Avinash Ganesan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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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 Year
FCF Growth rate for first 5 years 18% 1 2014 - 15
FCF Growth rate for last 5 years 10% 2 2015 - 16
Terminal Growth Rate 3.50% 3 2016 - 17
Discount Rate 9% 4 2017 - 18
5 2018 - 19
Intrinsic Value Calculation (INR Crs, unless indicated) 6 2019 - 20
Total PV of cash flow 6,078.68 7 2020 - 21
Total Debt 75.94 8 2021 - 22
Cash & Cash Balance 294.50 9 2022 - 23
Net Debt (218.56) 10 2023 - 24
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.


Present Value Table
Cash flowf Cash flow
165.61 151.93
195.41 164.48
230.59 178.06
272.09 192.76
321.07 208.67
353.18 210.59
388.50 212.52
427.35 214.47
470.08 216.44
517.09 218.42

2023 - 24
9,730.67
4,110.34
2013 2014 2015 2016 2017
471.72 393.84 552.00 864.51 793.75
108.09 189.5 409.90 204.26 133.06
363.63 204.34 142.1 660.25 660.69
-44% -30% 365% 0%
406.202

10
20%
15%
2%
8%
cash flow PV
1 487.4424 451.336
2 584.9309 501.484
3 701.9171 557.204
4 842.3005 619.116
5 1010.761 687.907
6 1162.375 732.493
7 1336.731 779.970
8 1537.24 830.523
9 1767.827 884.353
10 2033.001 941.673
6986.059

TERMINAL VALUE 34561.009


PV of terminal 16008.434

22994.493
total debt 97.51
cash 90.37
23001.633
448.63727
493.501

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