ParticularsValue Analysis

1 Growth Rat 0.05 Growth over the past two years has been just below 5%. Assuming that the situation gets better
2 COGS as a 0.6 COGS in 2017 and 2018 were 63% and 62%, respectively. As per the above assumption, the si
3 Selling & 0.34 S&A expenses have been stable at around 34% in 2017 & 2018, and hence, the same value was
4 Interest 12 Assume the same interest expense as the last year
5 Tax 0.25 Tax rate has been steady across the years, and hence, 25% has been chosen.
6 Cash Balan 0.025 The cash balance has been fairly steady across the two years, hence 2.5% has been assumed.
7 Days Recei 14 This parameter has increased over the last two years probably because of the trends in the indu
8 Inventory 10.5 This has fluctuated
The growth from
rate in the 10.89
cost to 9.77, and
of property which is a hugeisjump.
equipment ThisAssuming
13.65%. might havethehappened as par
same value for
9 Property & 0.136476 Also, assuming that with the growth in sales, the expenses in property and equioment also incre
10 Days Payab 30 The days payable has increased from 26 to 32. Probably the money earned is being reinvestedto
11 Other accr 0.016 The value has been pretty steady at 1.5% to 1.6%, hence assuming the same value as last year o
12 Bank Loan 0.333333 Assuming that the company is expanding, they would require all the available amount. But the
13 Bonds Outs 200 Assuming that the company is expanding, they would require all the available amount. Hence,
14 Common S 125 Assuming that the company would maintain the existing stocks and not reissue any stocks, let's
15 Owner's eq 0.21 The growth rate is nearly 30%, which is high. Assuming there would be certain growth but not
16 Interest Ex 0.056 This is calculated based on the interest rate in the industry as of today (say 5.6%) and multiply
ing that the situation gets better, let's choose a slightly higher growth rate of 5%
er the above assumption, the situation would get slightly better, and hence, let's go with the assumption of COGS being close to 61% in 201
, and hence, the same value was chosen.

een chosen.
nce 2.5% has been assumed.
ecause of the trends in the industry. Hence, assuming it would increase but not by a significant margin, let's keep it at 14 days
hisAssuming
%. might havethehappened as part
same value of stock
for the clearance
projections or discount sales. Since this is not a sustainable option in the long run, let's assume the v
of 2019.
operty and equioment also increases
ney earned is being reinvestedto make the best out of the available resources. Hence, assuming a median value of 30 days
ng the same value as last year of 1.6%
l the available amount. But the interest would have increased as the company would have taken an additional loan. Hence, the value for 201
l the available amount. Hence, the value for 2019 would be the same as that of 2018
and not reissue any stocks, let's assume the same value as that of 2018
would be certain growth but not as much as 30%, comparing to the market industry, let's assume 21%
today (say 5.6%) and multiply it with the outstanding amount, which is bank loan amount and bonds outstanding
COGS being close to 61% in 2019

keep it at 14 days
the long run, let's assume the value of 10.5

ue of 30 days

l loan. Hence, the value for 2019 would increase by 1/3rd

 Particulars 2017 2018 ROUGH WORK
Income Statement
Revenue 2713 2844 0.048286
COGS 1721 1768 0.6343531
A Revenue-COGS 992 1076
Selling & Admin 913 964 0.3365278
B (A)-(Selling & Admin) 79 112
Interest Expense 10 12
C (B)-Interest Expense 69 100
Tax 17 25 0.2463768
Net Income 52 75

Balance Sheet 2017 2018

Cash (A) 62 74 0.0228529
Accounts Receivable (B) 85 103 11.43568
Inventory (C) 158 181 10.892405
SUM: A+B+C 305 358
Property & Equipment (D) 403 458
SUM: A+B+C+D 708 816

Accounts Payable (E) 123 156 26.086578

Other accrued expenses (F) 41 48 0.0151124
Bank loan (G) 24 32
SUM: E+F+G 188 236
Bonds outstanding (H) 200 200 0.0446429
Common stock (I) 125 125
Owner's equity (J) 195 255
SUM: E+F+G+H+I+J 708 816
 Forecast

ROUGH WORK Particulars 2019

Income Statement Same Interest
Revenue 2986.2
0.6216596 COGS 1791.72
A Revenue-COGS 1194.48
0.3389592 Selling & Admin 1015.308
B (A)-(Selling & Admin) 179.172
Interest Expense 12
C (B)-Interest Expense 167.172
0.25 Tax 41.793
Net Income 125.379

Balance Sheet
0.0260197 Cash (A) 74.655
13.219058 Accounts Receivable (B) 114.53917808219
9.7679558 Inventory (C) 170.64
SUM: A+B+C 359.83417808219
0.1364764 Property & Equipment (D) 520.50620347395
SUM: A+B+C+D 880.34038155614

32.205882 Accounts Payable (E) 147.26465753425

0.0168776 Other accrued expenses (F) 47.7792
0.3333333 Bank loan (G) 42.666666666667
SUM: E+F+G 237.71052420091
0.0517241 Bonds outstanding (H) 200
Common stock (I) 125
0.3076923 Owner's equity (J) 308.55
SUM: E+F+G+H+I+J 871.26052420091
 2019
Linked Interest
2986.2
1791.72
1194.48
1015.308
179.172
13.5893333333333
165.582666666667
41.3956666666667
124.187

74.655
114.539178082192
170.64
359.834178082192
520.506203473945
880.340381556137

147.264657534247
47.7792
42.6666666666667
237.710524200913
200
125
308.55
871.260524200913