Question: solve the problem im stuck in the question Question 1: (10) I am interested in purchasing the shares of a company that is being traded

solve the problem im stuck in the question

solve the problem im stuck in the question Question 1: (10) I

Question 1: (10) I am interested in purchasing the shares of a company that is being traded currently in the market at PKR 51.50. From the following information of the company, you are required to advise me whether I should buy the shares of this company or not with appropriate reasoning. An appropriate Cash Based Method of valuation will be used to analyze the data. Y ear 0 1 2 3 4 5 Capital Expenditure 200 200 210 230 230 240 Net Working Capital 75 80 95 100 90 110 Depreciation Expense 200 200 200 200 200 200 EBIT 800 800 900 850 1000 1100 Additional Information: Tax rate = 20% Debt to Equity Ratio = 30:70 Value of Debt = 10,000 Risk Free Rate = Last digit of your SAP ID No. of shares outstanding = 500 Market Rate = 20% Cost of Debt = Risk Free Rate

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