Question: please show excel formulas Problem 2. Part A. Apply the fundamental method of valuation to the following data in order to find a market value
Problem 2. Part A. Apply the fundamental method of valuation to the following data in order to find a market value (price) for the venture Part B. What portion of the company should be given up if there is a need for S1.6 m in venture capital? (30 points total) Revenue (Sales) After-tax Margin Year % of growth After-tax Profit Discount Factor PV of Earnings 0 0 1.30 0 1 15% 3.4 m 2 20 4% 3 25 S 4 30 10 5 35 13 6 40 16 7+ 9 12% As you see from line 7 and beyond (7+), growth falls to 12%, and profit margin is 9% Assume also discount rate for years 7 and beyond falls to 15% and stays the same for all such years
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