Financial Model Excel File

Financial Model and Valuation
Niharika Consumer Products Limited

A Case Study for Financial Modeling & Valuation
About the Model
This model has been prepared solely to serve as a basis for demonstration of various techniques and steps involved in Financial Mode
leading to Valuation. It doesn’t depict efficient or inefficient handling of a situation by an individual or corporate. All the historical
information has been taken from publicly available sources and forward looking projections are based on judgments of the author. Th
an investment thesis and not intended to form a basis for any investment decisions.
Copyright © EduPristine
All rights reserved. No part of this document may be produced, stored in a retrieval system or transmitted in any form or by any mean
electronic, mechanical, photocopying, recording or otherwise without the prior permission of the author or Pristine.
Revision Control
Rev. Description By Date
0 Initial Issue Author 2012
1 Revision post comments Author 2013
2 Issued for usage in FM course Edupristine 2013
3 Minor updates / corrections and year update Author 14-04-2015
Valuation
ucts Limited
eps involved in Financial Modeling

orporate. All the historical
n judgments of the author. This is not
ed in any form or by any means,

or or Pristine.
Assumption Sheet
Year Tracker 1 2 3 4 5
Unit FY12A FY13A FY14A FY15A FY16A
Revenue Drivers
Prices
y-o-y growth rates
Soap 12.5% 11.1% 5.0% 4.8%
Hair Colour 6.7% 10.0% 4.5% 3.3%
Detergents 12.0% 11.6% 8.0% 7.4%
CAGR w.r.t first year
Soap 12.5% 11.8% 9.5% 8.3%
Hair Colour 6.7% 8.3% 7.0% 6.1%
Detergents 12.0% 11.8% 10.5% 9.7%
Volumes
y-o-y growth rates
Soap 15.0% 11.3% 18.8% 18.4%
Hair Colour 6.7% 5.3% 5.6% 4.3%
Detergents 14.3% 8.8% 6.3% 5.4%
Soap 15.0% 13.1% 15.0% 15.8%
Hair Colour 6.7% 6.0% 5.9% 5.5%
Detergents 14.3% 11.5% 9.7% 8.6%
Raw Material Cost Drivers
Prices
y-o-y growth rates
Acid 0.0% 2.9% 7.1% 9.3%
Speciality chemicals 21.6% 11.1% 6.0% 3.8%
Ordinary chemicals 47.1% 12.0% 7.1% 16.7%
Perfumes 8.3% 7.7% 7.1% 6.7%
Acid 0.0% 1.0% 2.5% 4.8%
Speciality chemicals 10.3% 10.6% 9.4% 10.4%
Page 3 of 67 Anthored byShashi Bhushan

Assumption Sheet
Ordinary chemicals 21.3% 18.1% 15.3% 19.8%
Perfumes 4.1% 5.3% 5.7% 7.5%
Volume Conversion Matrix
Soaps
Acid ml 105 105 105 105 105
Speciality chemicals ml 10 10 10 10 10
Ordinary chemicals ml 5 5 5 5 5
Perfumes ml 10 10 10 10 10
Hair Color
Acid ml 255 255 255 255 255
Perfumes ml 5 5 5 5 5
Detergents
Acid ml 505 505 505 505 505
Perfumes ml 12 12 12 12 12
Employee Cost Drivers
Head Count
y-o-y growth rates
Average Salary
y-o-y growth rates
Bonus as % of Salary 10.0% 12.0% 12.0% 12.0% 15.0%
Power Cost Drivers
Tarif
y-o-y growth rates
Consumption in Production Process
y-o-y growth rates

Assumption Sheet
Packaging Cost Drivers
Unit Cost
y-o-y growth rates
Other Cost Drivers
Advertisement Cost % of Sales 7.3% 8.3% 7.0% 6.5% 6.0%
Commission % of Sales 4.9% 4.9% 4.9% 4.9% 4.9%
Maintenace Cost % of Sales 0.2% 0.2% 0.2% 0.2% 0.2%
Insurance Premium % of Sales 0.5% 0.4% 0.3% 0.3% 0.3%
Admin & Misc Expenses % of Sales 8.5% 4.9% 4.9% 6.1% 5.9%
Working Capital & Balance Sheet Drivers
Items having linkage with P&L
Provisions for Employees fund % of Employee Cost 13.4% 9.5% 9.7% 9.5%
Commissions Payables days of commission 57 88 88 59
Accounts Payables days of raw material costs 40 45 42 35
Inventory (Days of raw materials cost) days of raw material costs 112 130 119 105
Accouts Receivables days of sales 31 33 31 27
Other Items
Advances from customers INR Lakhs 7
Insurance premium payable INR Lakhs 2
[+] Loans & Advances INR Lakhs 16
Investments INR Lakhs 140
Capital Expenditure
Land 100 50 - - 50
Plant, Machinery & Buildings 400 400 10 10 10
Laptops, Desktops & Mobile 10 10 5 5 5
Furnitures, Fixtures & Furnishings 35 25 - - -
Total Capital Expenditure 545 485 15 15 65
Capex Completion Schedule
Land 100.0% 100.0% 100.0% 100.0% 100.0%

Assumption Sheet
Plant, Machinery & Buildings 90.0% 90.0% 90.0% 90.0% 90.0%
Laptops, Desktops & Mobile 100.0% 100.0% 100.0% 100.0% 100.0%
Furnitures, Fixtures & Furnishings 100.0% 100.0% 100.0% 100.0% 100.0%
Asset Deletion Schedule
Land - - - - -
Plant, Machinery & Buildings - - - - -
Laptops, Desktops & Mobile - - - - -
Furnitures, Fixtures & Furnishings - - - - -
Depreciation Schedule Books (SLM) IT Act (WDV)
Plant, Machinery & Buildings 18.0% 15.0%
Laptops, Desktops & Mobile 33.3% 60.0%
Furnitures, Fixtures & Furnishings 15.0% 10.0%
Debt Financing Assumptions
Fund Based Working Capital
Funded through Cash Credit / Overdraf 60.0%
Cash Credit / Overdraf Sanctioned Limit INR Lakhs 100
Cash Credit / Overdraf - Interest Rate 13.5%
Minimum cash & cash equivalent to months of expe 2

be maintained on balance sheet
Non Fund Based (NFB) Limit

Sanctioned Limit INR Lakhs 200
Margin Money for NFB 30.0%
Sales share of R&G 25.0%
Bank Guarantee Requirement Equivalent to 3 months of sales
Issuance Charges on NFB 2.3%
Secured Loan
Sanctioned Limit INR Lakhs 300
Interest Rate 13.0%

Assumption Sheet
No default repayment - - 15 15 15
Unsecured Loan
Interest Rate 15.0%
No default repayment - 15 15 15 15
Other Income Drivers
Interest rate on margin money deposits 8.0%
Average annual yield on investments 12.0%
Equity Financing Assumption
Face Value of Share Rs. / share 10
Dividend Payout INR Lakhs - - - - -
Share Issue Price Rs. / share 10 10
No. of Shares Outstanding Lakhs 30
D:E ratio to be maintained in 2
incremental funding
Tax Rate Assumptions
Income Tax Rate inclusive of surcharge and cess 34.0%
MAT Rate inclusive of surcharge and cess 20.0%
MAT Credit Available at the year end INR Lakhs -
Valuation Assumptions
Risk free rate 7.5%
Beta 80.0%
Expected return from market 15.0%
Cost of debt 12.0%
Target debt: capital ratio 50.0%
Terminal Growth Rate 4.0%

6 7 8 9 10
FY17P FY18P FY19P FY20P FY21P
5.0% 5.0% 2.0% 2.0% 3.0%

6.1% 6.1% 6.1% 6.1% 6.1%
4.0% 4.0% 2.0% 2.0% 3.0%
7.6% 7.2% 6.4% 5.9% 5.5%

6.1% 6.1% 6.1% 6.1% 6.1%
8.6% 7.8% 6.9% 6.3% 5.9%
15.0% 14.0% 13.0% 13.0% 12.0%

5.0% 5.0% 5.0% 5.0% 5.0%
5.0% 5.5% 6.0% 6.0% 6.0%
15.7% 15.4% 15.0% 14.8% 14.5%

5.4% 5.3% 5.3% 5.2% 5.2%
7.9% 7.5% 7.3% 7.1% 7.0%
5.0% 5.0% 4.0% 4.0% 4.0%

5.0% 5.0% 4.0% 4.0% 4.0%
15.0% 15.0% 13.0% 13.0% 13.0%
7.5% 7.5% 7.0% 7.0% 7.0%
4.8% 4.9% 4.7% 4.6% 4.6%

9.3% 8.6% 7.9% 7.4% 7.0%

6 7 8 9 10
18.8% 18.2% 17.4% 16.9% 16.4%
7.5% 7.5% 7.4% 7.3% 7.3%
105 105 105 105 105

10 10 10 10 10
5 5 5 5 5
10 10 10 10 10
255 255 255 255 255

12 12 12 12 12
8 8 8 8 8
5 5 5 5 5
505 505 505 505 505

25 25 25 25 25
15 15 15 15 15
12 12 12 12 12
0.0% 5.0% 5.0% 5.0% 5.0%
0.0% 5.0% 5.0% 5.0% 5.0%

15.0% 15.0% 15.0% 15.0% 15.0%
8.0% 8.0% 10.0% 10.0% 10.0%
10.9% 10.6% 10.2% 10.3% 9.7%

6 7 8 9 10
0.0% 2.0% 2.0% 2.0% 2.0%
10.0% 11.0% 12.0% 13.0% 14.0%

5.0% 6.0% 6.0% 7.0% 7.0%
0.2% 0.2% 0.2% 0.2% 0.2%
0.3% 0.3% 0.3% 0.3% 0.3%
4.9% 4.7% 4.7% 4.0% 3.9%
10.0% 10.0% 10.0% 10.0% 10.0%

60 60 60 60 60
40 40 40 40 40
100 95 90 90 90
27 25 25 25 25
7 7 7 7 7
2 2 2 2 2
16 16 16 16 16
140 140 140 140 140
- - - - -
10 200 200 150 125
10 5 5 5 5
30 - - - 5
50 205 205 155 135
100.0% 100.0% 100.0% 100.0% 100.0%

6 7 8 9 10
90.0% 90.0% 90.0% 90.0% 90.0%
100.0% 100.0% 100.0% 100.0% 100.0%
100.0% 100.0% 100.0% 100.0% 100.0%
- - - - -
- - - - -
- - - - -
- - - - -

6 7 8 9 10
15 15 15 15 15
15 15 15 15 15
- - - - -
25 25 25 25 25

Revenue Build Up Sheet
Year Tracker 1 2 3 4 5 6
Unit FY12A FY13A FY14A FY15A FY16A FY17P
Sales Price
Soap INR/ packet 16 18 20 21 22 23
Hair Colour INR/ bottle 75 80 88 92 95 101
Detergents INR/ packet 100 112 125 135 145 151
Sales Volume
Soap packets 421,875 485,156 540,000 641,250 759,375 873,281
Hair Colour bottles 281,250 300,000 315,938 333,750 348,188 365,536
Detergents packets 131,250 150,000 163,125 173,438 182,813 191,953
Segmental Revenue
Soap INR Lakhs 68 87 108 135 167 202
Hair Colour INR Lakhs 211 240 278 307 331 368
Detergents INR Lakhs 131 168 204 234 265 289
Total Revenue INR Lakhs 410 495 590 676 763 860

7 8 9 10
FY18P FY19P FY20P FY21P
24 25 25 26
107 113 120 128
157 160 163 168
995,541 1,124,961 1,271,206 1,423,751

383,748 402,868 422,941 444,014
202,511 214,661 227,541 241,193
241 278 321 370

410 457 509 567
318 343 371 405
969 1,079 1,201 1,342

Costs Build Up Sheet
Raw Material Prices
Acid paise/ ml 6.8 6.8 7.0 7.5 8.2 9
Speciality chemicals paise/ ml 3.7 4.5 5.0 5.3 5.5 6
Ordinary chemicals paise/ ml 1.7 2.5 2.8 3.0 3.5 4
Perfumes paise/ ml 12.0 13.0 14.0 15.0 16.0 17
Raw Material Volumes
Acid litres 182,297 203,191 219,642 240,023 260,843 281,842
Speciality chemicals litres 10,875 12,202 13,269 14,753 16,342 17,918
Ordinary chemicals litres 6,328 7,076 7,674 8,478 9,325 10,170
Perfumes litres 7,200 8,152 8,937 10,163 11,528 12,864
Raw Material Cost
Acid INR Lakh 124 138 154 180 214 243
Speciality chemicals INR Lakh 4 5 7 8 9 10
Ordinary chemicals INR Lakh 1 2 2 3 3 4
Perfumes INR Lakh 9 11 13 15 18 22
Total INR Lakh 138 156 175 206 245 279
Headcount
Manufacturing Nos. 28 30 35 40 40 40
Marketing professionals Nos. 5 5 7 8 9 9
Corporate employees Nos. 2 2 2 3 3 3
Average Monthly Salary
Manufacturing INR/month/per 10,000 10,500 11,000 11,100 11,700 11,700
Marketing professionals INR/month/per 15,000 16,000 17,000 17,500 18,000 18,000
Corporate employees INR/month/per 16,000 16,500 17,200 17,800 18,200 18,200
Total Employees Cost
Salaries INR Lakh 46 51 65 76 82 82
Bonus INR Lakh 5 6 8 9 12 12
Total INR Lakh 51 58 72 86 94 94
Power Cost

Costs Build Up Sheet
Tarif INR/ unit 5.3 5.7
Consumption in Production Process Units 177,737 197,075
Other Consumption Units 19,749 21,897
Total INR Lakh 5 6 7 9 10 12
Packaging Cost
Soap INR/ unit 1.0 1.1 1.2 1.3 1.3 1.3
Hair Colour INR/ unit 1.5 1.6 1.8 1.9 1.9 1.9
Detergents INR/ unit 2.0 2.2 2.3 2.5 2.5 2.5
Total INR Lakh 11 13 16 19 21 23
Advertisement Cost INR Lakh 30 41 42 44 46 86
Commission INR Lakh 20 24 29 33 37 43
Maintenace Cost INR Lakh 1 1 1 1 1 1
Insurance Premium INR Lakh 2 2 2 2 2 2
Admin & Misc Expenses INR Lakh 35 24 29 41 45 42

7 8 9 10
9 9 10 10
6 6 7 7
5 5 6 7
18 20 21 23
304,655 329,256 356,235 384,520

19,623 21,451 23,476 25,596
11,085 12,068 13,153 14,289
14,304 15,840 17,557 19,352
275 310 348 391

12 14 15 17
5 6 8 10
26 31 37 44
319 361 409 462
42 45 48 51
10 11 12 13
4 5 6 7
12,285 12,899 13,544 14,221

18,900 19,845 20,837 21,879
19,110 20,066 21,069 22,122
94 108 123 140

14 16 18 21
108 124 142 161

7 8 9 10
6.1 6.7 7.4 8.2
217,878 240,012 264,695 290,489
24,209 26,668 29,411 32,277
15 18 22 26
1.3 1.4 1.4 1.4

1.9 2.0 2.0 2.1
2.6 2.6 2.7 2.7
26 29 32 36
107 129 156 188
58 65 84 94
2 2 2 2
3 3 3 4
45 50 48 52

Profit & Loss Statement
(All figures in INR Lakhs unless stated otherwise) FY12A FY13A FY14A FY15A FY16A FY17P
Revenue 410 495 590 676 763 860
Operating Expenses
Raw Material Cost 138 156 175 206 245 279
[+] Employee Cost 51 58 72 86 94 94
[+] Power Cost 5 6 7 9 10 12
[+] Packaging Cost 11 13 16 19 21 23
[+] Advertisement Cost 30 41 42 44 46 86
[+] Commission 20 24 29 33 37 43
[+] Maintenance Cost 1 1 1 1 1 1
[+] Insurance Premium 2 2 2 2 2 2
[+] Admin & Misc Expenses 35 24 29 41 45 42
[-] Total Operating Expenses 293 326 373 440 502 584
117 170 217 236 261 276
[-] Depreciation 73 152 163 163 163 142
43 17 54 72 98 133
[-] Interest 23 63 81 78 75 65
[+] Other Income - - 2 8 15 18
20 (46) (25) 2 37 86
Taxes for the year
Current Tax 10 - 10 24 40 51
[+] Deferred Tax (3) (11) (18) (23) (27) (22)
[-] Total Taxes for the year 7 (11) (8) 1 13 29
14 (35) (16) 1 25 57

7 8 9 10

969 1,079 1,201 1,342
319 361 409 462

108 124 142 161
15 18 22 26
26 29 32 36
107 129 156 188
58 65 84 94
2 2 2 2
3 3 3 4
45 50 48 52
681 780 897 1,024
288 298 304 318
105 93 111 132
183 206 193 186
57 59 57 52
18 18 19 19
143 165 154 152
53 50 50 56
(4) 6 2 (4)
49 56 52 52
95 109 102 100

Balance Sheet
Liabilities & Equity
Current Liabilities & Provisions
Cash Credit / Overdraf Utilization 25 53 47 72 55 58
[+] Provisions for Employees fund 10 6 8 9 9 9
[+] Advances from customers 5 8 12 4 7 7
[+] Commission payable 4 4 10 6 6 8
[+] Insurance premium payable 2 2 2 2 2 2
[+] Accounts payable 16 18 25 22 25 16
Total Current Liab. & Prov. 61 91 104 114 104 101
Non Current Liabilities
Secured Loans - 300 285 270 255 240
[+] Unsecured Loans 300 285 270 255 240 129
[+] Total Non Current Liabilities 300 585 555 525 495 369
Networth
Paid Up Capital 200 300 300 300 300 300
[+] Share Premium Account - - - - - -
[+] Retained Earnings 14 (21) (37) (36) (11) 46
[+] Total Networth 214 279 263 264 289 346
Total Liabilities & Equity 574 955 921 903 888 816
Current Assets
Cash & Cash Equivalent 21 10 62 87 101 97
[+] Margin Money with Bank - - - 13 14 16
[+] Inventory 36 60 65 69 72 62
[+] Account Receivables 33 52 55 60 51 62
[+] Loans & Advances 10 14 15 20 16 16
Total Current Assets 99 136 197 249 254 253
Net Fixed Assets
Gross Block 505 990 1,044 1,059 1,124 1,174

Balance Sheet
[-] Accumulated Depreciation 73 226 389 552 715 857
[+] Net Fixed Assets 432 764 655 507 409 317
[+] WIP 40 40 1 1 1 1
[+] Deferred Tax Assets 3 14 33 56 84 105
[+] Investments - - 35 90 140 140
Total Assets 574 955 921 903 888 816
Check 1 1 1 1 1 1

7 8 9 10
57 68 69 83
12 13 16 17
7 7 7 7
11 10 17 14
2 2 2 2
27 22 34 29
117 122 145 152
259 276 261 246

114 99 77 32
374 375 338 278
309 318 318 318

14 26 26 26
140 250 351 452
463 593 695 796
953 1,090 1,178 1,225
114 130 150 171

18 20 23 25
83 74 104 98
56 77 71 93
16 16 16 16
287 317 363 403
1,360 1,565 1,725 1,863

7 8 9 10

963 1,055 1,166 1,298
397 510 559 564
20 20 15 13
109 103 101 105
140 140 140 140
953 1,090 1,178 1,225
1 1 1 1

Asset Schedule Corresponding to Balance Sheet
Capital Expenditure
Land 100 50 - - 50 -
Plant, Machinery & Buildings 400 400 10 10 10 10
Laptops, Desktops & Mobile 10 10 5 5 5 10
Furnitures, Fixtures & Furnishings 35 25 - - - 30
Total 545 485 15 15 65 50
Project Completion Schedule
Land 100% 100% 100% 100% 100% 100%
Plant, Machinery & Buildings 90% 90% 90% 90% 90% 90%
Laptops, Desktops & Mobile 100% 100% 100% 100% 100% 100%
Furnitures, Fixtures & Furnishings 100% 100% 100% 100% 100% 100%
Land - - - - - -
Laptops, Desktops & Mobile - - - - - -
Furnitures, Fixtures & Furnishings - - - - - -
Total 40 40 1 1 1 1
Asset Creation Schedule
Land 100 50 - - 50 -
Laptops, Desktops & Mobile 10 10 5 5 5 10
Furnitures, Fixtures & Furnishings 35 25 - - - 30
Total 505 485 54 15 65 50
Asset Deletion Schedule
Land - - - - - -
Plant, Machinery & Buildings - - - - - -
Laptops, Desktops & Mobile - - - - - -
Furnitures, Fixtures & Furnishings - - - - - -
Total - - - - - -

Gross Block
Opening - 100 150 150 150 200
[+] Asset Creation during the year 100 50 - - 50 -
[-] Asset Deletion during the year - - - - - -
Closing Balance 100 150 150 150 200 200
Plant, Machinery & Buildings
Gross Block
Opening - 360 760 809 819 829
[+] Asset Creation during the year 360 400 49 10 10 10
Closing Balance 360 760 809 819 829 839

Book Depreciation Schedule 18%
Depreciation due to Asset Created in
FY09A 360 65 65 65 65 65 36
FY10A 400 72 72 72 72 72
FY11A 49 9 9 9 9
FY12A 10 2 2 2
FY13E 10 2 2
FY14P 10 2
FY15P 181
FY16P 200
FY17P 155
FY18P 128
Total Depreciation 65 137 146 147 149 122
IT Depreciation Schedule 15%
FY09A 360 54 46 39 33 28 24
FY10A 400 60 51 43 37 31
FY11A 49 7 6 5 5
FY12A 10 2 1 1
FY13E 10 2 1
FY14P 10 2
FY15P 181
FY16P 200
FY17P 155
FY18P 128
Laptops, Desktops & Mobile
Gross Block
Opening - 10 20 25 30 35

[+] Asset Creation during the year 10 10 5 5 5 10
Closing Balance 10 20 25 30 35 45
FY09A 10 3 3 3 0 - -
FY10A 10 3 3 3 0 -
FY11A 5 2 2 2 0
FY12A 5 2 2 2
FY13E 5 2 2
FY14P 10 3
FY15P 5
FY16P 5
FY17P 5
FY18P 5
FY09A 10 6 2 1 0 0 0
FY10A 10 6 2 1 0 0
FY11A 5 3 1 0 0
FY12A 5 3 1 0
FY13E 5 3 1
FY14P 10 6
FY15P 5
FY16P 5
FY17P 5
FY18P 5

Furnitures, Fixtures & Furnishings
Gross Block
Opening - 35 60 60 60 60
[+] Asset Creation during the year 35 25 - - - 30
FY09A 35 5 5 5 5 5 5
FY10A 25 4 4 4 4 4
FY11A - - - - -
FY12A - - - -
FY13E - - -
FY14P 30 5
FY15P -
FY16P -
FY17P -
FY18P 5
FY09A 35 4 3 3 3 2 2
FY10A 25 3 2 2 2 2
FY11A - - - - -
FY12A - - - -
FY13E - - -
FY14P 30 3
FY15P -
FY16P -

FY17P -
FY18P 5
Combined Total
Gross Block 505 990 1,044 1,059 1,124 1,174
Book Depreciation 73 152 163 163 163 142
IT Depreciation 64 120 109 94 82 78

7 8 9 10
- - - -
200 200 150 125
5 5 5 5
- - - 5
205 205 155 135
100% 100% 100% 100%

90% 90% 90% 90%
100% 100% 100% 100%
100% 100% 100% 100%
- - - -
20 20 15 13
- - - -
- - - -
20 20 15 13
- - - -
181 200 155 128
5 5 5 5
- - - 5
186 205 160 138
- - - -
- - - -
- - - -
- - - -
- - - -

7 8 9 10
200 200 200 200

- - - -
- - - -
200 200 200 200
839 1,020 1,220 1,375

181 200 155 128
- - - -
1,020 1,220 1,375 1,503

7 8 9 10
- - - -
40 - - -
9 5 - -
2 2 1 -
2 2 2 1
2 2 2 2
33 33 33 33
36 36 36
28 28
23
87 79 101 122
20 17 15 13
27 23 19 16
4 3 3 2
1 1 1 1
1 1 1 1
1 1 1 1
27 23 20 17
30 26 22
23 20
19
81 99 107 110
45 50 55 60

7 8 9 10

5 5 5 5
- - - -
50 55 60 65
- - - -
- - - -
- - - -
0 - - -
2 0 - -
3 3 0 -
2 2 2 0
2 2 2
2 2
2
7 7 5 5
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0
2 1 0 0
3 1 0 0
3 1 0
3 1
3
6 5 5 5

7 8 9 10
90 90 90 90
- - - 5
- - - -
90 90 90 95
4 - - -
4 3 - -
- - - -
- - - -
- - - -
5 5 5 5
- - - -
- - -
- -
1
12 7 5 5
2 2 2 1
1 1 1 1
- - - -
- - - -
- - - -
3 2 2 2
- - - -
- - -

7 8 9 10

- -
1
6 5 5 5
1,360 1,565 1,725 1,863

105 93 111 132
94 110 118 120

Cash Credit and Term Loan Schedule
Working Capital Requirement
Current Assets excluding Cash
[+] Inventory 62
[+] Account Receivables 62
[+] Loans & Advances 16
Total Current Assets excluding Cash 140
Current Liabilities & Provisions
[+] Provisions for Employees fund 9
[+] Advances from customers 7
[+] Commission payable 8
[+] Insurance premium payable 2
[+] Accounts payable 16
Total Current Liabilities & Provisions 43
Working Capital 97
Cash Credit / Overdraf Sanctioned Limit 100
Working Capital Funded by Cash Credit / Overdraf F60% 58
Maximum Incremental Cash Credit Utilization 4
Cash Credit / Overdraft Utilization 25 53 47 72 55 58
Interest on Working Capital Loan 14% 8
Secured Loans
Opening Balance 255
[+] Fresh debt during the year -
[-] Mandatory Repayment during the year 15
[-] Additional Repayment during the year -
Closing Balance - 300 285 270 255 240
Secured Loan Limit 300
Maximum Incremental fresh debt issue 60
Average balance for the year 248
Interest Rate 13%

Cash Credit and Term Loan Schedule
Interest on Secured Loans 32
Unsecured Loans
Opening Balance 240
[+] Fresh debt during the year -
[-] Repayment during the year 15
[-] Additional Repayment during the year 96
Closing Balance 300 285 270 255 240 129
Average balance for the year 185
Interest Rate 15%
Interest on Secured Loans 24
Bank Guarantee
Annual Sales to R&G 25% 215
Value of Bank Guarantee (Equivalent to) 3 months of sales 48 54
Margin Money Required 30% 14 16
Issuance Charges 2% 1.2

7 8 9 10
83 74 104 98
56 77 71 93
16 16 16 16
155 167 191 207
12 13 16 17
7 7 7 7
11 10 17 14
2 2 2 2
27 22 34 29
59 54 76 68
96 113 115 139
57 68 69 83
(1) 10 1 14
57 68 69 83
8 8 9 10
240 259 276 261

34 32 - -
15 15 15 15
- - - -
259 276 261 246
75 56 39 54
250 267 268 253

7 8 9 10

32 35 35 33
129 114 99 77
- - - -
15 15 15 15
- - 7 30
114 99 77 32
122 107 88 55
16 14 11 7
242 270 300 336

61 67 75 84
18 20 23 25
1.4 1.5 1.7 1.9

Current and Deferred Tax Schedule
Current Tax
Book PBT 86
[+] Book Depreciation 142
[-] IT Depreciation 78
PBT for IT calculation 150
Cummulative PBT 150
Tax Liability as per IT Act 34% 51
MAT 20% 17
MAT Credit - - -
Tax Payable 51
Deferred Tax Liability (Assets)
Opening (84)
[+] Deferred Tax During the Year (22)
Closing (84) (105)

7 8 9 10
143 165 154 152

105 93 111 132
94 110 118 120
155 148 147 164
306 453 601 765
53 50 50 56
29 33 31 30
- - - -
53 50 50 56
(105) (109) (103) (101)

(4) 6 2 (4)
(109) (103) (101) (105)

Shareholders' Equity Schedule
Year Tracker - 1 2 3 4 5 6 7
(All figures in INR Lakhs unless stated otherwise) Unit FY12A FY13A FY14A FY15A FY16A FY17P FY18P
Face Value of Share Rs. / share 10
Equity Infusion During the year - 23
Share Issue Price Rs. / share 25 25
Nos. of Shares Issued Lakhs - 0.9
Shares Outstanding
Opening Lakhs 30 30
[+] Issued during the year Lakhs - 0.9
[-] Extinguished during the year Lakhs - -
Closing Lakhs 30 30 31
Paid Up Capital
Opening 300 300
[+] Issued during the year - 9
[-] Extinguished during the year - -
Closing 300 300 309
Share Premium Account
Opening - -
[+] Issued during the year - 14
[-] Extinguished during the year - -
Closing - - 14
Retained Earnings Account
Opening (11) 46
[+]PAT during the year 57 95
[-] Dividend paid during the year - -
Closing (11) 46 140

8 9 10
FY19P FY20P FY21P
21 - -
25 25 25
0.8 - -
31 32 32
0.8 - -
- - -
32 32 32
309 318 318

8 - -
- - -
318 318 318
14 26 26
13 - -
- - -
26 26 26
140 250 351

109 102 100
- - -
250 351 452

Cash Flow Statement
Cashflow from Operating Activities
(35) (16) 1 25 57
[+] Deferred Tax Liability (11) (18) (23) (27) (22)
[+] Depreciation 152 163 163 163 142
[+] Interest Expense 63 81 78 75 65
Net Change in Working Capital
[+] Increase in Provisions for Employees fund (4) 2 1 1 -
[+] Increase in Advances from customers 3 4 (8) 3 -
[+] Increase in Commission payable 0 6 (4) - 2
[+] Increase in Insurance premium payable - - - - -
[+] Increase in Accounts payable 2 7 (3) 3 (9)
[-] Increase in Margin Money with Bank - - 13 2 2
[-] Increase in Inventory 24 5 4 3 (9)
[-] Increase in Account Receivables 19 3 5 (9) 10
[-] Increase in Loans & Advances 4 1 5 (4) -
[+] Net Change in Working Capital (45) 10 (41) 15 (9)
Cashflow from Operations 124 219 178 251 233
Cashflow from Investing Activities
Capital Expenditure
Asset Created during the year 485 54 15 65 50
[+] Increase in WIP - (39) - - -
[-] Total Capital Expenditure 485 15 15 65 50
Author:
[+] Gain from Disposal of Assets Capex is inclusive of WIP, - - - - -
[-] Increase in Investments WIP to be interpreted as - 35 55 50 -
that capex which is yet to (485) (50) (70) (115) (50)
Cashflow from Investment Activities
be ready for revenue
Cashflow from Financing Activities generation
[-] Interest Expense 63 81 78 75 65
[-] Dividends Paid - - - - -
[-] Secured Loans Mandatory Repayment - 15 15 15 15

Cash Flow Statement
[-] Unsecured Loans Mandatory Repayment 15 15 15 15 15
[+] Additional Cash Credit Utilization 28 (6) 25 (17) 4
[+] New Equity Raised 100 - - - -
[+] New Secured Loans Raised 300 - - - -
[+] New Unsecured Loans Raised - - - - -
[-] Additional Unsecured Loans Repaid 96
[-] Additional Secured Loans Repaid -
Cashflow from Financing Activities 350 (117) (84) (122) (187)
Net Cashflow (10) 52 25 14 (4)
Cash & Cash Equivalent
Opening 21 10 62 87 101
[+] Cashflow during the year (10) 52 25 14 (4)

Cash Flow Statement
Funding Covenants Testing
Likely Cashflow During the year before 92
compliance to funding covenants
[+] Year opening cash & cash equivalent 101
Likely year end cash & cash equivalent 193

before compliance to funding covenants
[-] Minimum cash & cash equivalent to be

maintained on balance sheet (months of 2.0 97
expenses)
Check 1
Surplus 96
Shortfall -
Incremental Debt : Equity Ratio Requirement 1.5
Incremental Debt to be raised -

7 8 9 10
95 109 102 100

(4) 6 2 (4)
105 93 111 132
57 59 57 52
3 1 3 1
- - - -
3 (1) 7 (4)
- - - -
11 (5) 12 (5)
2 2 2 3
21 (9) 29 (6)
(6) 21 (6) 22
- - - -
(1) (19) (4) (27)
253 247 268 254
186 205 160 138

19 - (5) (3)
205 205 155 135
- - - -
- - - -
(205) (205) (155) (135)
57 59 57 52
- - - -
15 15 15 15

7 8 9 10

15 15 15 15
(1) 10 1 14
23 21 - -
34 32 - -
- - - -
- - 7 30
- - - -
(32) (25) (93) (98)
16 17 20 21
97 114 130 150

16 17 20 21
114 130 150 171

7 8 9 10
(41) (36) 27 52
97 114 130 150
57 77 157 201
114 130 150 171
1 1 1 1
- - 7 30
57 53 - -
34 32 - -

Ratio Analysis
(All figures are dimensionless unless stated otherwise) FY12A FY13A FY14A FY15A FY16A FY17P
Profit Margins
EBITDA Margin 28% 34% 37% 35% 34% 32%
EBIT Margin 11% 3% 9% 11% 13% 16%
PBT Margin 5% -9% -4% 0% 5% 10%
PAT Margin 3% -7% -3% 0% 3% 7%
Growth Rates
Revenue 21% 19% 15% 13% 13%
EBITDA 45% 28% 9% 11% 6%
EBIT -60% 214% 34% 35% 37%
-323% -46% -108% 1796% 131%
-355% -53% -108% 1796% 131%
As a % of Sales
Raw Material Cost 34% 31% 30% 30% 32% 32%
Employee Cost 12% 12% 12% 13% 12% 11%
Power Cost 1% 1% 1% 1% 1% 1%
Packaging Cost 3% 3% 3% 3% 3% 3%
Advertisement Cost 7% 8% 7% 7% 6% 10%
Commission 5% 5% 5% 5% 5% 5%
Maintenace Cost 0% 0% 0% 0% 0% 0%
Insurance Premium 0% 0% 0% 0% 0% 0%
Admin & Misc Expenses 9% 5% 5% 6% 6% 5%
Liquidity Ratio
Current Ratio 1.6x 1.5x 1.9x 2.2x 2.4x 2.5x
Quick Ratio 1.0x 0.8x 1.3x 1.6x 1.8x 1.9x
Return Ratio
Author:
ROAE PAT/Avg(C.Y. Networth,
-14% -6% 0% 9% 18%
Author:
Pre Tax ROACE
L.Y. Networth)
EBIT/Avg(C.Y. Capital,
2% 6% 9% 12% 18%
Author:
Post Tax ROACE
L.Y. Capital) 2% 4% 6% 8% 12%
EBIT*(1-t)/Avg(C.Y.
Author:
ROAA Capital, L.Y. Capital)
PAT/Avg(C.Y. Assets,
-5% -2% 0% 3% 7%
L.Y. Assets)

Ratio Analysis Author:
EBIT/Avg(C.Y. Capital,
Year Tracker Author:
L.Y. Capital) 1 2 3 4 5 6
EBIT*(1-t)/Avg(C.Y.
Author:
Capital, L.Y. Capital)
PAT/Avg(C.Y. Assets,
Leverage Ratio L.Y. Assets)
Debt/ Equity 1.4x 2.1x 2.1x 2.0x 1.7x 1.1x
Debt/ EBITDA 2.6x 3.4x 2.6x 2.2x 1.9x 1.3x
Interest Coverage 1.9x 0.3x 0.7x 0.9x 1.3x 2.1x
DSCR - Method 1
Author: 4.8x 2.9x 2.8x 3.1x 3.5x 2.8x
Author:
DSCR - Method 2
(PAT+Dep+Interest)/(Interest+Mandatory
(PAT+Dep)/(Mandatory
7.9x 4.9x 5.5x 6.3x 6.6x
Debt Repayment Obligation)
Debt Repayment
Obligation)

7 8 9 10
30% 28% 25% 24%

19% 19% 16% 14%
15% 15% 13% 11%
10% 10% 8% 7%
13% 11% 11% 12%

4% 4% 2% 5%
37% 13% -6% -4%
66% 15% -7% -1%
66% 15% -7% -1%
33% 33% 34% 34%

11% 12% 12% 12%
2% 2% 2% 2%
3% 3% 3% 3%
11% 12% 13% 14%
6% 6% 7% 7%
0% 0% 0% 0%
0% 0% 0% 0%
5% 5% 4% 4%
2.5x 2.6x 2.5x 2.7x

1.7x 2.0x 1.8x 2.0x
23% 21% 16% 13%

24% 23% 19% 18%
16% 15% 13% 12%
11% 11% 9% 8%

7 8 9 10
0.8x 0.6x 0.5x 0.3x

1.3x 1.3x 1.1x 0.9x
3.2x 3.5x 3.4x 3.6x
2.9x 2.9x 3.1x 3.5x
6.7x 6.7x 7.1x 7.8x

DCF Valuation
Risk free rate 7.5%
Beta 0.80
Cost of equity 13.5%
Cost of debt 12.0%
Post tax cost of debt 7.9%
WACC 10.7%
Year Tracker - 1 2 3 4 5 6 7
(All figures in INR Lakhs unless stated otherwise) FY12A FY13A FY14A FY15A FY16A FY17P FY18P
Free Cashflow to the Firm (FCFF)
EBIT*(1-Tax Rate) 88 121
[+] Depreciation 142 105
[-] Author:
Increase in Working Capital 9 1
Working capital should
[-] exclude
Capex cash from current 50 205
Free Cashflow
assets to thecapital
and working Firm (FCFF) 171 20
loan
Terminal Value / cash credit / overdraft
balance from current
Terminal
liabilitiesValue
Discount Factors
No. of Years 1 2
Discount Factor 0.90 0.82
Enterprise Value
Present Value of FCFF 154 17
[+] Present Value of Terminal Value
Enterprise Value 1,152
Equity Value
Add market value of all the interest
bearing or idle items from Asset side of
balance sheet
[+] Cash & Cash equivalent 101
[+] Margin Money with Bank 14

DCF Valuation
Risk free rate 7.5%
Beta 0.80
Cost of debt 12.0%
WACC 10.7%
Year Tracker - 1 2 3 4 5 6 7
[+] Investments 140
Subtract market value of all the interest
bearing or idle items from liabiliites side
of balance sheet
[-] Working Capital Loan / Cash Credit / Overdraf Utilized 55
[-] Secured Loans 255
[-] Unsecured Loans 240
Subtract any contingent or other of the
B/S liabilities that may become liability in
future
[-] Any Contingent Liabilities 24
Equity Value 833
No. of Shares 30
Share Price (INR) 28

DCF Valuation
Risk free rate 7.5%
Beta 0.80
Cost of debt 12.0%
WACC 10.7%
Year Tracker - 1 2 3 4 5 6 7
Sensitivity on Enterprise Value
Valuation Ladder As depicted in green shade TERMINAL GROWTH RATE
Valuation Range INR Lakhs 1000 - 1200 1,152 3.0% 3.5%
Valuation Range should be such that at WACC 10.0%
least one value from each row and column 10.5%
of the sensitivity table falls inside it 11.0%
11.5%
12.0%

8 9 10
FY19P FY20P FY21P
136 127 123

93 111 132
19 4 27
205 155 135
4 79 93
1,445
3 4 5
0.74 0.67 0.60
3 52 56
869

8 9 10
FY19P FY20P FY21P
4.0% 4.5% 5.0%

Relative Valuation
(Financials in INR Lakhs unless stated otherwise)

No of Shares Lakhs 30
Trading Comparables
Sl. No. Company EV Mkt Cap EV/ Sales (x) EV/ EBITDA (x)
FY16A FY17P FY18P FY16A FY17P FY18P
A Company A 1,169 989 1.4x 1.3x 1.1x 4.1x 3.7x 3.4x
B Company B 1,321 1,254 1.1x 1.2x 1.1x 4.7x 4.3x 3.6x
C Company C 1,456 1,342 1.5x 1.7x 1.5x 4.8x 4.4x 3.8x
D Company D 1,289 1,432 1.0x 0.9x 0.8x 4.1x 3.9x 3.5x
E Company E 987 1,100 2.0x 1.6x 1.5x 3.8x 3.5x 3.1x
Mean
Median
Relative Valuation on the Basis of EV/Sales Multiple

Valuation on the basis of (Median) [-]
Working
Capital
[+] Cash & [+] Margin
Money with [+] Investments Loan /
Sl. No. Parameter Multiple (x) Sales EV Cash Cash
equivalent Bank Credit /
Overdraft
A FY16A EV/ Sales (x) Utilized
B FY17P EV/ Sales (x)
Relative Valuation on the Basis of EV/EBITDA Multiple

Working
Capital
Sl. No. Parameter Multiple (x) EBITDA EV Cash Cash
Overdraft
A FY16A EV/ EBITDA (x) Utilized
B FY17P EV/ EBITDA (x)
Relative Valuation on the Basis of P/E Multiple

Relative Valuation

Valuation on the basis of (Median)
Mkt Cap Price Per

Sl. No. Parameter Multiple (x) PAT share
A FY17P P/E (x)
B FY18P P/E (x)
Transaction Multiples
Sl. No. Transaction Year EV/sales (x) EV/EBITDA (x) P/E (x) % stake
A Co. X acquired Co. Y 2013 1.5x 4.6x 18.2x 100.0%
B PE firm F invested in Co. Z 2014 0.8x 2.8x 12.2x 10.0%
C Co. A acquired Co. B 2014 1.7x 4.1x 17.0x 51.0%
D PE investment in Co. G 2015 0.9x 2.5x 11.7x 5.0%
E Co. P acquired Co. Q 2015 1.6x 4.9x 15.0x 26.0%
Mean
Median
Relative Valuation Using Transaction Multiples - EV/Sales

Working
Capital
Sl. No. Parameter Multiple (x) Sales EV Cash Cash
Overdraft
A FY16A EV/ Sales (x) Utilized
Relative Valuation Using Transaction Multiples - EV/EBITDA

Working
Capital
Sl. No. Parameter Multiple (x) EBITDA EV Cash Cash
Overdraft
Utilized
Relative Valuation

A FY16A EV/ EBITDA (x)
Relative Valuation Using Transaction Multiples - P/E

Valuation on the basis of (Median)
Sl. No. Parameter Multiple (x) PAT Mkt Cap Share Price
A FY16A P/ E (x)

P/ E (x)
FY16A FY17P FY18P
15.1x 11.7x 9.3x
17.8x 12.2x 8.7x
16.1x 12.6x 9.7x
15.6x 12.3x 9.0x
13.6x 11.3x 8.7x
[-] Secured [-] [-] Any Equity Price Per

Unsecured Contingent
Loans Value share
Loans Liabilities

Loans Value share
Loans Liabilities

Loans Value share
Loans Liabilities

Loans Value share
Loans Liabilities

Basis of valuation of share
Min Max Diff Please create a Fo
price
EV/Sales
EV/EBITDA
P/E
Please create a Football Field Chart

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Financial Model and Valuation

Niharika Consumer Products Limited

About the Model

eps involved in Financial Modeling

ed in any form or by any means,

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Minimum cash & cash equivalent to months of expe 2

Non Fund Based (NFB) Limit

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5.0% 5.0% 2.0% 2.0% 3.0%

7.6% 7.2% 6.4% 5.9% 5.5%

15.0% 14.0% 13.0% 13.0% 12.0%

15.7% 15.4% 15.0% 14.8% 14.5%

5.0% 5.0% 4.0% 4.0% 4.0%

4.8% 4.9% 4.7% 4.6% 4.6%

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105 105 105 105 105

255 255 255 255 255

505 505 505 505 505

0.0% 5.0% 5.0% 5.0% 5.0%

0.0% 5.0% 5.0% 5.0% 5.0%

8.0% 8.0% 10.0% 10.0% 10.0%

10.9% 10.6% 10.2% 10.3% 9.7%

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0.0% 2.0% 2.0% 2.0% 2.0%

10.0% 11.0% 12.0% 13.0% 14.0%

10.0% 10.0% 10.0% 10.0% 10.0%

100.0% 100.0% 100.0% 100.0% 100.0%

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995,541 1,124,961 1,271,206 1,423,751

241 278 321 370

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304,655 329,256 356,235 384,520

275 310 348 391

12,285 12,899 13,544 14,221

94 108 123 140

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1.3 1.4 1.4 1.4

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FY18P FY19P FY20P FY21P

319 361 409 462

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FY18P FY19P FY20P FY21P

259 276 261 246

309 318 318 318

114 130 150 171

1,360 1,565 1,725 1,863

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FY18P FY19P FY20P FY21P

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