Required:

a)     Calculate the following of the last five years: ROE, Book Value per share, EPS, PE ratio, PB ratio and dividend ra
b)    Calculate CAGR of sales, EPS and volatility of ROE
c)     Calculate the growth rate of all the years
d)    Estimate EPS by making the following assumptions: 
i) Net Sales will increase by 10%, Operating expenses will decrease by 5% and all other expenses will remain at the same perce
e)      Derive the PE ratio using constant growth  dividend model.  For this purpose make the following assumptions: 
i) The dividend pay out ratio of the next year will be equal to that of average dividend payout ratios of year ending March 2016
ii) required rate of return will be found out using CAPM model assuming a risk free rate of 6%, Beta of 1.25 and market return
f)      Establish a value anchor and comment on the value.
ratio, PB ratio and dividend ratio

es will remain at the same percentage on revenue. The tax rate could be assumed at 25%
 the following assumptions: 
atios of year ending March 2016, 17 and 18;
Beta of 1.25 and market return of 13%. Growth rate could be assumed as calculated as per answer c).
 Tata Global Beverage
Standalone Balance Sheet
Mar-20 Mar-19 Mar-18
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 63.11 63.11
Total Share Capital 63.11 63.11
Revaluation Reserves 21.86 0
Reserves and Surplus 4,358.71 4,150.24
Total Reserves and Surplus 4,380.57 4,150.24
Total Shareholders Funds 4,443.68 4,213.35
Share Capital Suspense 0 0
NON-CURRENT LIABILITIES
Long Term Borrowings 0 0
Other Long Term Liabilities 0 0
Long Term Provisions 115.25 109.65
Total Non-Current Liabilities 115.25 109.65
CURRENT LIABILITIES
Short Term Borrowings 4.53 84.25
Trade Payables 239.42 248.46
Other Current Liabilities 180.92 189.16
Short Term Provisions 20.65 47.3
Total Current Liabilities 445.52 569.17
Total Capital And Liabilities 5,004.45 4,892.17
ASSETS
NON-CURRENT ASSETS
Tangible Assets 223.84 207.59
Intangible Assets 18.06 19.21
Capital Work-In-Progress 10.52 11.49
Intangible Assets Under Development 6.73 1.16
Other Assets 0.65 0.67
Fixed Assets 259.8 240.12
Non-Current Investments 2,318.59 2,284.28
Deferred Tax Assets [Net] 33.86 99.01
Long Term Loans And Advances 16.77 20.44
Other Non-Current Assets 167.28 147.89
Total Non-Current Assets 2,796.30 2,791.74
CURRENT ASSETS
Current Investments 497.74 536.98
Inventories 846.91 744.4
Trade Receivables 181.92 136.66
Cash And Cash Equivalents 472.95 535.27
Short Term Loans And Advances 8.13 8.1
Other Current Assets 200.5 139.02
Total Current Assets 2,208.15 2,100.43
Total Assets 5,004.45 4,892.17
MP of the share 756.66501 258 200

Standalone Profit & Loss account

Mar-19 Mar-18
INCOME
Revenue From Operations [Gross] 3,331.71 3,131.68
Less: Excise/Service Tax/Other Levies 0 0
Revenue From Operations [Net] 3664.88 3,331.71 3,131.68
Other Operating Revenues 97.95 97.95 85.64
Total Operating Revenues 3762.83 3,429.66 3,217.32
Other Income 182.51 182.51 147.58
Total Revenue 3945.34 3,612.17 3,364.90
EXPENSES
Cost Of Materials Consumed 1953.17 2,055.97 1,871.55
Purchase Of Stock-In Trade 22.47 23.65 33
Operating And Direct Expenses 72.02 75.81 69.45
Changes In Inventories Of FG,WIP And Stock-In Trade 0.15 0.16 -1.67
Employee Benefit Expenses 206.01 216.85 208.13
Finance Costs 13.00 13.18 13.65
Depreciation And Amortisation Expenses 30.15 31.68 27.2
Other Expenses 703.34 618.95 535.48
Total Expenses 3000.30 3,036.25 2,756.79
Profit/Loss Before Exceptional, Extra Ordinary Items And Tax 945.04 575.92 608.11
Exceptional Items 0 0 115.36
Profit/Loss Before Tax 945.04 575.92 723.47
Tax Expenses-Continued Operations
Current Tax 236.26 160.57 188.91
Less: MAT Credit Entitlement 0 0 0
Deferred Tax 4.42 4.42 0.24
Total Tax Expenses 240.68 164.99 189.15
Profit/Loss After Tax And Before Extra Ordinary Items 704.36 410.93 534.32
Profit/Loss From Continuing Operations 704.36 410.93 534.32
Profit/Loss For The Period 704.36 410.93 534.32
DIVIDEND AND DIVIDEND PERCENTAGE
Equity Share Dividend 157.78 157.77

ROE 14.75% 9.25% 12.68%

Book value per share 704.12 667.62
EPS 111.61 65.11 84.66
PE ratio(Retrospcetive) 6.78 3.96 2.36
PE ratio(Prospective) 2.31 3.07
PB ratio 0.37 0.30
Dividend ratio 0.39 0.38 0.30

CAGR of sales 4.46%

CAGR of EPS 8.65%
Range of ROE 12.17%
Average of ROE 12.05%
Voletility of ROE (Range/average) 101.02%

Growth Rate [(1-Divdend payout ratio)*ROE] 9.06% 5.70% 8.94%

CAPM model
ROE using CAPM model 14.75%
beta 1.25
rf 6%
rm 13%
 in Rs. Cr.
Mar-17 Mar-16 Mar-15

63.11 63.11 61.84 No. fo equity share 6.311 6.311 6.311 6.311 6.184
63.11 63.11 61.84
0 21.86 21.86
3,721.44 2,810.93 2,416.67
3,721.44 2,832.79 2,438.54
3,784.55 2,895.90 2,500.38
0 0 1.27

0 0 325
0 0 72.54
119.91 177.87 114.02
119.91 177.87 511.56

32.26 52.61 152.5

244.33 198.38 143.88
177.44 544.95 153.48
57.05 195.21 192.61
511.08 991.15 642.47
4,415.54 4,064.92 3,655.68

197.76 183.21 168.91

16.03 16.05 24.43
7.38 10.1 11.09
4.12 0 0.18
0.69 0 0
225.98 209.36 204.61
2,903.97 2,264.34 2,231.86
38.86 39.48 45.75
24.73 120.5 71.79
185.25 70.5 70.5
3,378.79 2,704.18 2,624.51

67.7 0 0
764.19 889.71 819.27
99.62 124.09 93.62
20.78 239.2 21.01
 11.97 104.47 93.36
72.49 3.27 3.91
1,036.75 1,360.74 1,031.17
4,415.54 4,064.92 3,655.68
195 220 185

in Rs. Cr.
Mar-17 Mar-16 Mar-15

2,987.39 2,991.31 2,797.95

0 6.82 0.24
2,987.39 2,984.49 2,797.71 Avg of sales 3,046.60
76.5 99.43 86.81
3,063.89 3,083.92 2,884.52
96.34 106.57 155.16
3,160.23 3,190.49 3,039.68

1,867.72 1,888.96 1,872.87

23.03 11.93 1.53
72.61 0 0
-1.79 -3.95 -27.99
187.82 186.88 161.92
49.1 29.61 34.19 avg Finance cost 27.946
23.7 22.79 19.94 avg Depreciation 25.062 0.82%
551.85 657.87 559.25 Avg other expenses 584.68 19.19%
2,774.04 2,794.09 2,621.71
386.19 396.4 417.97
0 264.57 -68.92
386.19 660.97 349.05

110.24 130.03 55.91

0 39 0
-0.05 6.27 4.14
110.19 97.3 60.05
276 563.67 289
276 563.67 289
276 563.67 289

168.31 142 142

7.29% 19.46% 11.56%

 599.68 458.87 404.33
43.73 89.32 46.73 d1 43.04396
4.46 2.46 3.96
2.30 5.03 2.07
0.33 0.48 0.46
0.61 0.25 0.49 Average of 2016,2017,2018) 0.39

4.46%
8.65%
12.17%
12.05%
101.02%

2.85% 14.56% 5.88%

Assuming Face value as 10