Operational Lease vs.

Loan
Cash Flow Analysis

MU-BALENO ALPHA
Car Model PETROL
Ex-Showroom Price 744,638
Registration 67,618
On Road - Price 812,256
Tenure 48
Interest rate 10.50%
Loan Percentage 85%
Loan Amount 632,942
Loan Installment 16,065
Expected Remarketable Price 335,087
Lease Installment 23,059

Tax Depreciation on Asset (15% Reducing Balance)

Loan Cashflow
Upfront Payment
Loan Repayment
Insurance
Insurance Disallowance
Maintenance
Opportunity cost ( Upfont payment )
Resale of Vehicle Excluding VAT
Net Cash (Outflows) / Inflows
Net Present Value of Cashflow discounted @ 11.5%

Operating Lease outflow

Lease Rental Per Month

Annual Lease Rental Outflows
Tax Benefit on Rental Outflows (@30%)
Net Cash (Outflows) / Inflows

Net Present Value of Cashflow discounted @ 11.5%

Loan outflow -INR 722,042

Lease Outflow -INR 594,581
 127,461

Tax benefit on fuel bills (considering the

mileage of 48K for 48 months) 87600

Tax benefit on Driver Allowance for 4 years 216000

Perquisite Tax (47,520)

Total Benefit INR 383,541

Net Benefit % 47.22%

 Book Value at the end of term 356,385
121,838 103,563 88,028 74,824 388,253
Year 1 Year 2 Year 3 Year 4 Total
Loan Cashflow
(179,313) (179,313)
(192,779) (192,779) (192,779) (192,779) (771,115)
(25,000) (21,250) (18,063) (15,353) (79,666)
(20,000) (20,000)
(10,000) (15,000) (20,000) (30,000) (75,000)
(16,138) (17,591) (19,174) (20,899) (73,802)
335,087 335,087
(423,230) (246,619) (250,015) 56,056 (863,809)
alue of Cashflow discounted @ 11.5% -INR 722,042

Operating Lease outflow

(23,059)
(276,713) (276,713) (276,713) (276,713) (1,106,851)
83,014 83,014 83,014 83,014 332,055
(193,699) (193,699) (193,699) (193,699) (774,796)

alue of Cashflow discounted @ 11.5% -INR 594,581

Calculation for tax saving on fuel bills
Total running for 48
Months 48,000
Mileage 12/km
Total fuel required 4,000
Fuel Cost 292000

Tax benefit 87600

Calculation for tax saving on driver
bills

Salary / month 15000

Salary for 48 months 720000
Tax Benefit 216000

Perquisite Tax Calculation

PT liability / Month for
Motor car 1800
PT liability / Month for
Driver allowance 900

Total Liability / Month 2700

Total Liability / Year 32400

Tax liability/year 9720
Tax liability for 4 years 38880
 Amortization of Loan

EMI 16,065
Month Principal O/S Principal Interest
1 616,877 10,667 5,398

2 606,210 10,761 5,304

3 595,450 10,855 5,210
4 584,595 10,950 5,115
5 573,645 11,045 5,019
6 562,600 11,142 4,923
7 551,458 11,240 4,825
8 540,218 11,338 4,727
9 528,880 11,437 4,628
10 517,443 11,537 4,528
11 505,905 11,638 4,427
12 494,267 11,740 4,325
13 482,527 11,843 4,222
14 470,684 11,946 4,118
15 458,738 12,051 4,014
16 446,687 12,156 3,909
17 434,531 12,263 3,802
18 422,268 12,370 3,695
19 409,898 12,478 3,587
20 397,420 12,587 3,477
21 384,832 12,698 3,367
22 372,135 12,809 3,256
23 359,326 12,921 3,144
24 346,405 13,034 3,031
25 333,371 13,148 2,917
26 320,223 13,263 2,802
27 306,960 13,379 2,686
28 293,581 13,496 2,569
29 280,085 13,614 2,451
30 266,471 13,733 2,332
31 252,738 13,853 2,211
32 238,884 13,975 2,090
33 224,910 14,097 1,968
34 210,813 14,220 1,845
35 196,593 14,345 1,720
36 182,248 14,470 1,595
37 167,778 14,597 1,468
38 153,181 14,725 1,340
39 138,456 14,853 1,211

40 123,603 14,983 1,082

41 108,619 15,114 950

42 93,505 15,247 818
43 78,258 15,380 685
44 62,878 15,515 550
45 47,363 15,650 414
46 31,713 15,787 277
47 15,926 15,926 139
48 0 16,065 0