Sr. No.

Particulars Year 0 Year 1 Year 2 Year 3 Year 4 Year 5

1 Revenue Growth 2.50% 4.50% 6.50% 5.50% 4.50%
2 Gross Margin ### 33% 34% 35% 36% 36%
3 SG&A ### 25% 25% 25% 24% 23%
4 Depreciation/PPE 10% 10% 10% 10% 10% 10%
5 NWC Turnover 4.4 5 5.2 5.5 5.8 6
6 PPE Turnover 1.8 1.8 1.9 2 2 2
7 Tax Rate 35%
8 Discount Rate (WACC) 8%
9 Terminal Growth Rate 4.50%

The Topline is $140 mn

or estimate NWC as % of Sales
or estimate Capex as % of Sales
Sr. No. Particulars Year 0 Year 1 Year 2 Year 3
1 Revenue Growth 0% 2.50% 4.50% 6.50%
2 Gross Margin ### 33% 34% 35%
3 SG&A ### 25% 25% 25%
4 Depreciation/PPE 10% 10% 10% 10%
5 NWC Turnover 4.4 5 5.2 5.5
6 PPE Turnover* 1.8 1.8 1.9 2
7 Tax Rate 35%
8 Discount Rate 8%
9 Terminal Growth Rate 4.50%

The Topline is $140 mn

Calculation Year 0 Year 1 Year 2 Year 3
10 Revenue 140 143.5 149.9575 159.7047
11 Cost of Goods Sold `12-10
12 Gross profit `10x2 46.06 47.355 50.98555 55.89666
13 Sales, General & Admin Exps `10x3 35.56 35.875 37.48938 39.92618
14 Dep `19x4 7.777778 7.972222 7.8925 7.985237
15 Operating Profit `12-13-14 2.722222 3.507778 5.603675 7.985237
16 Net Operating Profit after tax `15(1-7) 1.769444 2.280056 3.642389 5.190404

17 Net Working Capital `10/5 31.81818 28.7 28.83798 29.03723

18
19 PPE 77.77778 79.72222 78.925 79.85237

Cash flows
20 NOPAT 16 2.280056 3.642389 5.190404
21 Add. Dep 14 7.972222 7.8925 7.985237
22 Less. Capex (Change in 19) 1.944444 -0.79722 0.927369
23 Less. Increase in NWC Change in 17 -3.11818 0.137981 0.199244
24 Free Cash Flow `20+21-22-23 11.42602 12.19413 12.04903
25 Year 6 Steady State FCF Ref. 9
26 Terminal Value 25/ (8-9)
P.V. of Terminal Value
Discounted Cash Flow 10.57964 10.4545 9.564907
Enterprise Value 330.5307
Year 4 Year 5
5.50% 4.50% Increasing then decreasing
36% 36% Similar, minor change
24% 23% Similar, minor change
10% 10% Constant
5.8 6 or estimate NWC as % of Sales Improvement
2 2 or estimate Capex as % of SalesMinor improvement *Net of Depreciation

Year 4 Year 5
168.4885 176.0705

60.65586 63.38537
40.43724 40.49621
8.424425 8.803524
11.79419 14.08564
7.666227 9.155665

29.04974 29.34508 Revenue/NWC Turnover Because, NWC Turnover = Revenue/

84.24425 88.03524 *Assuming this is gross PPE Asset turnover = Revenue/Assets Asset = Revenue/Asset Turnover

7.666227 9.155665
8.424425 8.803524
4.39188 3.790991
0.012516 0.295339
11.68626 13.87286
14.4971374127
414.2039260766 Stable perpetuity 173.4107
281.9002322331
8.589746 9.441635
NWC Turnover = Revenue/NWC

evenue/Asset Turnover