CAPM Rate

Risk Free Rate 0.97%

Market Risk Premium 7.50%
Beta 1.45
Cost of equity 11.85%
Terminal Growth Rate 1.00%

Therefore, it is assumed that 1% is the terminal growth rate

Cost of Equity 11.85%

Growth Rate 1.0%
Amounts in $Millions
Discounted Cash Flow Method 2021F 2022F 2023F
PV of FCF - 1,038,345 - 1,572,851 -2,049,438
Sum of PV - 4,660,634
PV of FCF beyond 2023 - 19,086,511
Enterprise Value - 23,747,145
Net Debt 2,581,418
Equity Value - 26,328,563
Total outstanding shares 3,857,120
Estimated per share price -$6.83
Market Price/ share $4.52

Recommendation Sell the shares since they are overvalued

DFCF Method - Sensitivity Analysis Upside Normal Downside

Growth Rate 2.50% 1.50% 0.00%
Cost of Equity 11.85% 11.85% 11.85%
Sum of PV - 4,660,634 ($4,660,634) ($4,660,634)
PV of FCF beyond 2023 ($22,479,119) ($20,108,065) ($17,302,134)
Enterprise Value ($27,139,753) ($24,768,699) ($21,962,768)
Total outstanding shares 3,857,120 3,857,120 3,857,120
Estimated per share price -$7.04 -$6.42 -$5.69
 Abnormal Earnings Method 2020A 2021F 2022F
Opening Equity $5,570,299 $5,595,900
Required Earnings (Normal) $659,802 $662,834
Forecasted Net Profit ($1,135,736) ($1,931,458)
Abnormal Earnings ($1,795,538) ($2,594,292)
PV ($1,605,381) ($2,073,890)
PV of abnormal earnings from 2021-2023 ($6,169,785)
PV of abnormal earnings after 2023 ($23,194,274)
Opening Equity $5,570,299
Enterprise Value ($23,793,759)
Total outstanding shares 3,857,120
Estimated per share price ($6.17)
Market Price/ share $4.52

Recommendation Sell the shares since they are overvalued

Abnormal Earnings Method - Sensitivity Analysis Upside Normal Downside

Terminal growth rate 2.50% 1.50% 0.00%
Cost of equity 11.85% 11.85% 11.85%
PV of abnormal earnings from 2021-2023 ($6,169,785) ($6,169,785) ($6,169,785)
PV of abnormal earnings after 2023 $27,317,032.82 $24,435,684.66 $21,025,866.36
Opening Equity $5,570,299 $5,570,299 $5,570,299
Enterprise Value ($27,916,518) ($25,035,170) ($21,625,352)
Total outstanding shares 3,857,120 3,857,120 3,857,120
Estimated per share price - 7.24 - 6.49 - 5.61
 2023F
$5,631,970
$667,107
($2,817,379)
($3,484,486)
($2,490,514)

e overvalued
Income Statement - DCG ($'000)
2018A 2019A 2020A % Change % Change 2019-2020
Revenue 1,535,761 1,584,808 1,074,153 3.2% -32.2%
COGS -698,262 -833,770 -729,404 19.4% -12.5%
Gross Profit 837,499 751,038 344,749 -10.3% -54.1%

SG&A Expenses -129,836 -139,143 -583,207 7.2% 319.1%

Other Operating Expenses
Other Income 9,579 67,169 58,124 601.2% -13.5%
EBITDA 717,242 679,064 -180,334 -5.3% -126.6%
Depreciation -326 -414 -424
Amorization 0 0 0
Interest Income 0 24,342 13,803
Interest Expense -209,850 -230,961 -204,164
Profit Before Tax 507,066 448,730 -365,604 -11.5% -181.5%
Income Tax Expense -166,190 -136,310 44,947 -18.0% -133.0%
Net Income 341,202 312,420 -320,657 -8.4% -202.6%
 Forecasting Assumptions
Difference 2018A 2019A 2020A 2021F 2022F 2023F
-35.4% Sales Growth Forecast 29.02% 3.19% -32.22% 15% 20% 25%
-31.9%
-43.8% Gross Margin Forecast 54.53% 47.39% 32.09% 12.00% 13.00% 14.00%

312.0% Forecast of Operating Expenses / Sales 8.45% 8.78% 54.29% 14.00% 15.00% 16.00%

-614.7%
-121.2%
Depreciation Expense / PPE Ratio 0.01% 0.00% 0.00% 20.00% 25.00% 30.00%

Interest Expense / Borrowings Ratio 3.42% 3.68% 3.95% 15.00% 15.00% 15.00%
-170.0%
-115.0%
-194.2%
 Forecasted Income Statement
2020A 2021F 2022F 2023F %Change
Revenue 1,074,153 1,235,276 1,482,331 1,852,914 72.50%
COGS -729,404 (1,383,509) (1,675,034) (2,112,322)
Gross Profit 344,749 148,233 192,703 259,408 -24.75%

SG&A Expenses (583,207) (172,939) (222,350) (296,466)

Other Operating Expenses
Other Income 58,124 58,124 58,124 58,124
EBITDA -180,334 33,418 28,477 21,066 -111.68%
Depreciation -424 (1,124,101) (2,167,909) (3,335,245)
Amorization 0 0 0 0
Interest Income 13,803 13,803 13,803 13,803
Interest Expense -204,164 (545,600) (633,597) (724,451)
Profit Before Tax -365,604 (1,622,480) (2,759,226) (4,024,827) 1000.87%
Income Tax Expense 44,947 486,744 827,768 1,207,448
Net Income -320,657 (1,135,736) (1,931,458) (2,817,379) 778.63%

Key IS Items 2021F 2022F 2023F Key Ratios

Revenue 1,235,276 1,482,331 1,852,914 Sales Growth
COGS (1,383,509) (1,675,034) (2,112,322) Gross Margin
Gross Profit 148,233 192,703 259,408 SG&A Expenses/ Sales
SG&A Expenses (172,939) (222,350) (296,466) EBITDA Margin
EBITDA 33,418 28,477 21,066 Depreciation Expense/ PPE
Depreciation (1,124,101) (2,167,909) (3,335,245) Effective Interest Rate
Interest Expense (545,600) (633,597) (724,451) Net Profit Margin
Profit Before Tax (1,622,480) (2,759,226) (4,024,827)
Net Income (1,135,736) (1,931,458) (2,817,379)
2021F 2022F 2023F
15.00% 20.00% 25.00%
12.00% 13.00% 14.00%
14.00% 15.00% 16.00%
2.71% 1.92% 1.14%
20.00% 25.00% 30.00%
15.00% 15.00% 15.00%
-91.94% -130.30% -152.05%
 Balance Sheets
2018A 2019A 2020A
Cash 600,557 396,232 540,842
Accounts Receivables 228,705 272,087 169,446
Inventories 90,428 104,038 127,789
Other Current Assets 12,302 19,867 29,958
Total Current Assets 931,992 792,224 868,035
PP&E 6,489,335 9,122,379 8,761,362
Intangible Assets 3,958 54,443 59,534
Other Non-Current Assets 3,248,606 1,603,807 1,699,334
Total Non-Current Assets 9,741,899 10,780,629 10,520,230
Total Assets 10,673,891 11,572,853 11,388,265
Account Payable 326,484 337,022 187,139
Short-Term Debt 356,739 654,513 725,376
Other Current Liabilities 87,750 129,186 56,941
Total Current Liabilities 770,973 1,120,721 969,456
Long-Term Debt 3,068,035 3,140,069 2,581,418
Other Non-Current Liabilities 1,669,265 2,053,652 2,267,092
Total Non-Current Liabilities 4,737,300 5,193,721 4,848,510
Total Liabilities 5,508,273 6,314,442 5,817,966
Total Equity 5,165,618 5,258,411 5,570,299
Operating Working Capital / Sales 10.48% -20.73% -9.44%
 Forecast Y
2018A 2019A 2020A 2021F

PPE/Sales Ratio 422.5% 575.6% 815.7% 455.0%

Other Non-Current Assets / Sales Ratio 211.5% 101.2% 158.2% 220.0%

Short-term-debt growth

Long term Debt/Equity Ratio 59.4% 59.7% 46.3% 65.0%

Operating Working Capital / Sales 10.48% -20.73% -9.44% 16.00%

PPE Balance PPE balance forecast 9,111,816

Dividend Payout Forecast Dividend payout ratio 52%

Forecast Years
Key BS Items (in bold)
2022F 2023F
2021F 2020A
Current Assets 868,035
Accounts Receivables
Inventories
Other Current Assets
Total Current Assets
585.0% 600.0% PP&E 8,761,362
Intangible Assets 59,534
230.0% 240.0% Other Non-Current Assets 1,699,334
Total Non-Current Assets 10,520,230
Total Assets
Account Payable
Short-Term Debt 725,376
Other Current Liabilities
Total Current Liabilities
75.0% 85.0% Long-Term Debt 2,581,418
Other Non-Current Liabilities 2,267,092
Total Non-Current Liabilities
Total Liabilities
Total Equity
17.00% 18.00% Operating Working Capital - 101,421
+ Net Long-term Operating Assets 8,253,138
= Net Operating Assets 8,151,717
− Net Debt 2,581,418
9,567,407 10,045,778 = Closing Equity 5,570,299
Equity
Begining equity
+ Net profit
52% 52% − Dividend payments
− Share buyback
= Closing Equity
CASH FLOWS
Net profit
− Change in operating working capital
− Change in net long-term operating assets
+ Change in net debt
= Free cash flows to equity holders (Leveraged FCF)

Key Balance Sheet Items 2021F

Current Assets 911,437
Operating Working Capital 197,644
PP&E 5,620,506
Intangible Assets 59,534
Other Non-Current Assets 2,717,607
Short-Term Debt 725,376
Long-Term Debt 3,637,335
Closing Equity 5,595,900
 Key Income Statement Items 2020F
Sales 1,235,276
Net profit 18,120
Key Ratios 2020F
Debt to Equity ratio 65%
Net Debt to Equity ratio 13%
ROE 0%
 Forecast Balance Sheets
2021F 2022F 2023F
911,437 1,002,580 1,152,967

5,620,506 8,671,637 11,117,484

59,534 59,534 59,534
2,717,607 3,409,362 4,446,993
8,397,647 12,140,533 15,624,011

725,376 725,376 725,376

3,637,335 4,223,977 4,829,671

2,267,092 2,267,092 2,267,092

- - -

197,644 251,996 333,525

6,130,555 9,873,441 13,356,919
6,328,199 10,125,437 13,690,443
732,299 4,493,467 8,008,478
5,595,900 5,631,970 5,681,966
2021F 2022F 2023F
5,570,299 5,595,900 5,631,970
53,336 75,145 104,158
27,734 39,076 54,162
- - -
5,595,900 5,631,970 5,681,966
2021F 2022F 2023F
- 1,135,736 - 1,931,458 - 2,817,379
299,065 54,352 81,528
- 2,122,583 3,742,886 3,483,478
- 1,849,119 3,761,169 3,515,011
- 1,161,337 - 1,967,528 - 2,867,375

2022F 2023F Key Ratios 021F

1,002,580 1,152,967 Operating Working Capital / Sales 16.0%
251,996 333,525 PP&E / Sales 455.0%
8,671,637 11,117,484 PPE growth 5%
59,534 59,534 Current assets growth 5%
3,409,362 4,446,993 Other Non-Current Assets / Sales 220.0%
725,376 725,376 Short-term Debt growth rate 0.00%
4,223,977 4,829,671 Long-term Debt/ Equity 65.00%
5,631,970 5,681,966 Dividend Payout ratio 52%
Share Buyback -
 2021F 2022F
1,482,331 1,852,914
21,927 26,531
2021F 2022F
75% 85%
80% 141%
0% 0%
022F 023F
17.0% 18.0%
585.0% 600.0%
10% 15%
10% 15%
230.0% 240.0%
0.00% 0.00%
75.00% 85.00%
52% 52%
- -
 Ratio
Current Ratio
Quick Ratio
Inventory Turnover Ratio
Debt to equity ratio
Debt Ratio = Total liabilities / Total
Debt ratio
Equity ratio
Net profit margin
Operating profit margin
Gross profit margin
2018
Liqudity Ratio
Current Ratio = Current assets/
Current liabilities 0.016
Quick ratio = Current assets-
Inventory/ Current liabilities 1.092
Inventory turnover ratio= Cost
of goods sold/ Average
Inventory 7.722
Solvency Ratio
Debt-to-equity ratio = Total
debt/Total equity 59.39%
Assets 51.61%
Debt-Equity Ratio= Total
liabilities / Shareholder's equity 106.63%
Profitability ratio
Net profit = net profit/sales *
100% 22.22%
Operating Profit Margin =
Operating Profit/Net Sales 46.70%
Gross profit margin = Gross
profit/sales*100% 54.53%
 2019 2020 % change
Liqudity Ratio

0.018 0.031 93.66%

0.614 0.764 -30.05%

8.014 5.708 -26.08%

Solvency Ratio

59.72% 46.34% -21.97%

54.56% 51.09% -1.00%

120.08% 104.45% -2.05%

Profitability ratio

19.71% -29.85% -234.37%

42.85% -16.79% -135.95%

47.39% 32.09% -41.15%