As a treasury analyst, you are trying to value a potential target company X Co. The capital structure ratio (D/E) currently for X Co. is 70%. The regression analysis between X Co.'s stock returns and market returns returned a coefficient of 2.5 for the market returns. The corporate tax rate is 25%. The YTM of Indian government t-bill is 6%, and the market risk premium is 9%. The beta of debt is negligible. The FCFF projections are Rs. 250 million for Year 1, growing at 5% per annum from Year 1 to Year 3 (i.e. 1-2, 2-3). Beyond three years, FCFF for X Co. will grow at a constant rate of 2% per annum till perpetuity. The existing debt outstanding is Rs. 2500 million (considered a perpetual debt). The bond rating is B. The direct and indirect expected cost of bankruptcy is assumed to be 35% of the unlevered firm value. Calculate the value of the levered firm (range in Rs. million). [10] Bond rating B- B Default rate 32.5% 26.36%