Compile condensed balance sheet and condensed income statement based on the information given for Horizon Telecom Limited based on its financial statements for FY 2019 (Exhibits 6.1 and 6.2)

(2) Number of shares outstanding is 1,830 (in million) on 31st July 2019. You are a securities analyst who follows Horizon. The security price of the firm's shares is $7 per share. Provide your investment recommendations on Horizon's shares. Use the following assumptions:

Sales growth for 2020-2022: 20% 15%, and 10%

NOPAT margin for 2020-2022: 19%, 18%, and 17%

Forecasted NIEAT for 2020-2022: 38, 40, and 41

Horizon plans to pay dividends of $22 million in the year ended 31st July, 2020 and $24 million in the year ended 31st July, 2021. No dividends are proposed in future years.

Dividend payments as described above and the change in net income each year account for all changes in the book value of shareholders' equity each year

Risk-free rate: 1%

Equity beta: 0.48

Expected rate of return on the market portfolio: 7.5%

Expected growth in abnormal earnings after 2022: 4.0%

Hint: (1) You MUST use a continuity correction in your calculations.

(2) Keep three decimal places in your answer.

Also given:

Net interest expense after tax = (Interest expense - Interest income) * (1 - Tax rate)

Net operating profit after taxes = Net income + Net interest expense after tax

Operating working capital = (CA - Cash and marketable securities) - (CL - Short term debt)

Net long-term (non-current) assets = Total long-term assets - Non-interest bearing long-term liabilities (e.g., tax liabilities, P-E benefit obligations, provisions, etc.)

Net debt = Total interest-bearing liabilities - Cash and marketable securities

Net (operating) assets = Operating working capital + Net long-term (non-current) assets

Net capital = Net debt + Shareholders' equity