1. Compute the FCFF for the new stations during the explicit forecast period 2001-2004.

+ Corp.expenses as a % of BCF based on the data provided during 2001-2004

+ Tax @ 40%
+ Life of new capex = 5 years
[+]Depreciate capex using SLM
[-] How would you compute delta NWC?
2. What will be your choice of the discount rate ?

3. Compute the Terminal Value for these 21 stations based on

[a] 4% stable gr.rate [b] 5% st.gr.rate [c] 6 % st.gr.rate [d] TV at 18.1 times of BCF of 20
4. Compute the Ent.value for the new stations based on the following assumptions
+ Explicit forecast period of 15 years [2001-2015]
[+]Start with EBITDA projections
+ Consider the same figures during 2001-2004 [as per your answer to Q1 ]
+ Consider 10 % gr.rate in EBITDA& Cash flow adjustments during 2005-2015
+ assume 3% growth rate in stable phase
+ consider 40 % tax rate
[+] Consider the same discount rate
+ assume depreciation = capex from 2016

5. What would be the value of the new acquisitions using the trading & transaction multi
6. What is your final value ?

explicit forecast period 2001-2004. Assume the following

ovided during 2001-2004

(Equity Risk Premium = 7%)

e [d] TV at 18.1 times of BCF of 2004

on the following assumptions

r your answer to Q1 ]
ustments during 2005-2015

sing the trading & transaction multiples?

(Working Capital Growth Rate = 10%)

wth Rate = 10%)

Exhibit 9
Particulars
New Markets BCF
[-] Corporate Expenses
(5.06% of BCF)
EBITDA
[-] D&A
EBIT
-40% Tax
EBIAT
[+] D&A
[-] Delta Capex
[-] Delta NWC

2001
2002
76436
89711
3865.7638854 4537.1493003
72570.236115

85173.8507

90420
90840
-17849.763885 -5666.1493003
-7139.9055541 -2266.4597201
-10709.858331 -3399.6895802
90420
90840
2100
2100

2003
2004
101966
115277
5156.9480393 5830.1541605

2005

2006

92100

92100

96809.051961 109446.84584
91260
91680
5549.0519607 17766.845839
2219.6207843 7106.7383358
3329.4311764 10660.107504
91260
91680
2100
2100

Corporate Expense at % of BCF

Corp Exp
BCF
1997
2155000
13519000
1998
2800000
21608000
1999
4155000
37444000
2000
6000
116079
2001
6900
136034
2002
7935
158249
2003
9125
180786
2004
10494
205920

No of Stn =
Cap Exp =
Capex(21)=
Life =
Depriciation =
D&A =
Total Depr =

A/ R
Prepaid Exp
Current Asset
A/ P
Acc Exp
Current Liab
Delta NWC

(To find for new markets/ exhibit pro

15.94%
12.96%
11.10%
5.17%
5.07%
5.01% Average (2001-2004)
5.05%
5.10%

21
100
2100
5 years
(Straight Line Method)
420
90000 (Values in Thousand )
90420
Delta NWC
1997
8722
315
9037
258
3029
3287
5750

1998
12026
334
12360
1190
3708
4898
7462

1999
19833
1035
20868
1663
6941
8604
12264

nd for new markets/ exhibit provides a combined)

ge (2001-2004)

5.06%