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Financial Modeling: Case - Bus Service

Cost of Bus 7,500,000 Debt 75%


Maintenance / year 10% Equity 25%
Escalation Rate - Maintenance 15% Interest on Debt 15%
Life of Bus (years) 4 Tenure of loan (years) 4
Deprecation Rate 25% SLM Cost of Equity 20%
Seating Capacity 35 Fuel Efficiency ( Km / L ) 5
Load Factor 50% Driver Cost (Rs./ Trip) 500
Tariff (Rs./Ticket) 300.00 Miscellaneous (Rs. / Trip) 500
Escalation Rate - Tariff 10% Toll Amount (Rs. / Trip) 500
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Flag 0 1 2 3 4
Revenue 7665000 8431500 9274650 10202115 Escalation Rate - Tariff
Other Income
Fuel Costs 1,900,920 2,186,058 2,513,967 2,891,062 Diesel Price escalation
Maintenance Expenses 750,000 825,000 907,500 998,250
Driver Costs 730,000 803,000 883,300 971,630 Increase at inflation rate
Miscellaneous Costs 730,000 803,000 883,300 971,630 Increase at inflation rate
Toll Amount 730,000 803,000 883,300 971,630 Toll amount remains constant
Cost of Revenues 4,840,920 5,420,058 6,071,367 6,804,202
Gross Pofit / (EBITDA)
Depreciation
Interest Expense
Profit Before Tax
Income Taxes
Profit After Tax
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Assets
Cash
PPE, Gross
Acc Depreciation
PPE Net
Assumptions - Bus Assumptions - Financing
Assumptions - Operating Revenues Assumptions - Operating Costs
Income Statement
Balance Sheet
Total Assets

Liabilities
Debt
Equity
Retained Profit
Total Liabilities
Checksum - - - - -
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Net Income (PAT)
Depreciation
Cash Flow From Operations
Capex
Cash Flow from Investing
Debt (Repayment)/Issuance
Equity Addition
Cash Flow from Financing
Net change in Cash
Cash - BOP
Cash - EOP
Checksum - - - -
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Net Income
+ Depreciation
- Capital Expenses
- Debt Repayment/+ raised
Cash Flow to Equity
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
FCFE
Cost of Equity
Returns Analysis - Equity
Cash Flow Statement
Free Cash Flow - Equity
NPV
IRR
Tax Rate 33%
Debt is to be repaid in 4 equal annual installments at the end of every year
Interest Income 5%
Diesel rate (Rs./Lit) 53
Diesel Price escalation 15%
Inflation 10%
Route Mumbai - Pune
Distance (Kms) 155
Estimated Time Hours/Trip 3
Trips / Day 4
Escalation Rate - Tariff
All inflation/escalation happens from year 2
Diesel Price escalation
Increase at inflation rate
Increase at inflation rate
Toll amount remains constant
Debt Schedule
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
BOP - Debt
Int Expense
Principle Repaid
EOP - Debt
Assumptions - General
Assumptions - Operating General
EAI

10% 25% 40% 55%
12%
13%
14%
15%
16%
17%
Financing Debt (%) - For Neutral Case
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95%
Financing Debt (%) - For Neutral Case
Cost of Bus 7,500,000 Debt 75% Tax Rate 33%
Maintenance / year 10% Equity 25% Debt is to be repaid in 4 equal annual installments at the end of every year Repaid
Escalation Rate - Maintenance 15% Interest on Debt 15% Interest Income 5%
Life of Bus (years) 4 Tenure of loan (years) 4 Diesel rate (Rs./Lit) 53
Deprecation Rate 25% SLM Cost of Equity 20% Diesel Price escalation 15%
Inflation 10%
Seating Capacity 35 Fuel Efficiency ( Km / L ) 5 Route Mumbai - Pune
Load Factor 50% Driver Cost (Rs./ Trip) 500 Distance (Kms) 155
Tariff (Rs./Ticket) 300.00 Miscellaneous (Rs. / Trip) 500 Estimated Time Hours/Trip 3
Escalation Rate - Tariff 10% Toll Amount (Rs. / Trip) 500 Trips / Day 4
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Flag 0 1 2 3 4
Revenue 7,665,000 8,431,500 9,274,650 10,202,115 Escalation Rate - Tariff
Other Income All inflation/escalation happens from year 2
Fuel Costs 2,398,780 2,758,597 3,172,387 3,648,245 Diesel Price escalation
Maintenance Expenses 750,000 862,500 991,875 1,140,656
Driver Costs 730,000 803,000 883,300 971,630 Increase at inflation rate
Miscellaneous Costs 730,000 803,000 883,300 971,630 Increase at inflation rate
Toll Amount 730,000 730,000 730,000 730,000 Toll amount remains constant
Cost of Revenues 5,338,780 5,957,097 6,660,862 7,462,161
Gross Pofit / (EBITDA) 2,326,220 2,474,403 2,613,788 2,739,954
Depreciation 1,875,000 1,875,000 1,875,000 1,875,000
Interest Expense 843,750 632,813 421,875 210,938
Profit Before Tax (392,530) (33,410) 316,913 654,017
Income Taxes - - 104,581 215,826
Profit After Tax (392,530) (33,410) 212,332 438,191
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4 Debt Schedule
Assets Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Cash - 76,220 511,561 1,192,643 2,099,584 BOP - Debt 5,625,000 5,625,000 4,218,750 2,812,500 1,406,250
PPE, Gross 7,500,000 7,500,000 7,500,000 7,500,000 7,500,000 Int Expense 843,750 632,813 421,875 210,938
Acc Depreciation 1,875,000 3,750,000 5,625,000 7,500,000 EAI 1,406,250 1,406,250 1,406,250 1,406,250
PPE, Net 7,500,000 5,625,000 3,750,000 1,875,000 - EOP - Debt 5,625,000 4,218,750 2,812,500 1,406,250 -
Total Assets 7,500,000 5,701,220 4,261,561 3,067,643 2,099,584
Principle Repaid5,625,000 (1,406,250) (1,406,250) (1,406,250) (1,406,250)
Liabilities
Debt 5,625,000 4,218,750 2,812,500 1,406,250 -
Equity 1,875,000 1,875,000 1,875,000 1,875,000 1,875,000
Retained Profit (392,530) (425,940) (213,607) 224,584
Total Liabilities 7,500,000 5,701,220 4,261,561 3,067,643 2,099,584
Checksum - - - - -
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Net Income (PAT) - (392,530) (33,410) 212,332 438,191
Depreciation - 1,875,000 1,875,000 1,875,000 1,875,000
Cash Flow From Operations - 1,482,470 1,841,591 2,087,332 2,313,191
Capex (7,500,000) - - - -
Cash Flow from Investing (7,500,000) - - - -
Debt (Repayment)/Issuance 5,625,000 (1,406,250) (1,406,250) (1,406,250) (1,406,250)
Equity Addition 1,875,000
Cash Flow from Financing 7,500,000 (1,406,250) (1,406,250) (1,406,250) (1,406,250)
Net change in Cash - 76,220 435,341 681,082 906,941
Cash - BOP - - 76,220 511,561 1,192,643
Cash - EOP - 76,220 511,561 1,192,643 2,099,584
Checksum - - - -
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4
Net Income - (392,530) (33,410) 212,332 438,191
+ Depreciation - 1,875,000 1,875,000 1,875,000 1,875,000
- Capital Expenses (7,500,000) - - - - 4% 10% 25% 40% 55% 95%
- Debt Repayment/+ raised 5,625,000 (1,406,250) (1,406,250) (1,406,250) (1,406,250) 12% 9.0% 9.2% 9.4% 9.7% 8.6%
Cash Flow to Equity (1,875,000) 76,220 435,341 681,082 906,941 13% 8.9% 9.0% 9.0% 8.8% 1.6%
14% 8.8% 8.7% 8.6% 7.9% -4.8%
15% 8.8% 8.5% 8.2% 7.0% -10.6%
16% 8.7% 8.3% 7.7% 6.2% -15.9%
Year - 0 Year - 1 Year - 2 Year - 3 Year - 4 17% 8.6% 8.1% 7.2% 5.3% -20.7%
FCFE (1,875,000) 76,220 435,341 681,082 906,941
Cost of Equity 20.0%
NPV ($677,644)
IRR 3.67%
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Income Statement
Financing Debt (%) - For Neutral Case
Balance Sheet
Cash Flow Statement
Free Cash Flow - Equity
Returns Analysis - Equity
Assumptions - Bus Assumptions - Financing
Assumptions - Operating Revenues Assumptions - Operating Costs Assumptions - Operating General
Assumptions - General