Sensitivity Analysis

Input Variables:
• Fixed Cost
• Sale Price Per Unit
• Generated Units
• Variable Cost
Sr. No Variables Base Year Case 1 Case 2 Case 3 Case 4
Changed FC Changed Sales Price Changed Changed VC
Generated Price
1 Fixed Cost
184,900 129,430 184,900 184,900 184,900
2 Variable Cost
22,819 22,819 22,819 22,819 15,974
3 Sale Price Per
Unit
287,488 287,488 344,986 316,237 287,488
4 Generated Units
17,968 17,968 17,968 19,765 17,968
 Sensitivity Analysis
NPV Base Year – 140,846

Year Case 1 Case 2 Case 3 Case 4

0 -1000,000 -1000,000 -1000,000 -1000,000
1 233,104 234,426 215,675 201,388
2 217,204 218,437 200,964 187,652
3 202,390 203,538 187,257 174,853
4 188,585 189,655 174,485 162,927
5 175,722 176,719 162,584 151,814
Total OCF 1,017,005 1,022,775 940,964 878,635
NPV 17,005 22,775 (59,036) (121,365)
 Scenario Analysis
1. Base Year is Year 1
2. Scenarios are developed based on WACC 7.32%
3. Input for Scenarios are as under

Sr. No Variables Base Year Best Case Worst Case

1 Fixed Cost
184,900 166,410 203,390
2 Variable Cost
1.3 1 1.40
3 Sale Price Per Unit 16 18 14
 Scenario Analysis
1. Operating Cash Flow Formula
OCF ((Unit Sales per year- V Cost)*Price per unit cost -Fixed Cost)*(1-Tax
Rate)+Dep Ex*Tax Rate

OCF Variables

Base Year
211,338
Best Case
266,702
Worst Case
160,319
Assumptions for NPV Calculation
• Case OCF is held constant for all years
• Change in Networking Capital is held constant for all years
• Change in Net Capital Sepnding is held constant for all years
 Scenario Analysis
NPV Base Year – 140,846

Year Base Best Worst

0 -1,000,000 -1,000,000 -1,000,000
1 196,923 248,511 149,384
2 183,492 231,560 139,195
3 170,976 215,766 129,701
4 159,314 201,049 120,854
5 148,448 187,336 112,611
Total OCF 859,154 1,084,223 651,745
NPV (140,846) 84,223 (348,255)