[tanzeel.rehman2020]

Cgt

[tanzeel.rehman2020]

Q1 market value of equity of unbundled subsidiary using following methods
net asset method
pe ratio method
FCFF
dividend growth model

Q2 HEDGING
Forward and future contracts
market to market future
marginal call

Q3 investment appraisal
NPV
APV
IRR
MIRR
duration
VAR

[tanzeel.rehman2020]

My paper was like
1. APV-> NPV + Tax benefits on two loans (normal and subsidised), issue costs, some assumptions requirements.

Base case i forgot they wrote in question that loan need to repaid on year four
Base case npv +20.22
I discounted it with 11%
1.25 asset beta were given so i put this in capm and i hope i did right . Am i supposed to ungeared it to calculate beta equity

Assumptions
There was 12% in year 2
10% in year 3
7% in year 4

I forgot was that inflation or growth

Sensitivity analysis of sales volumes.

Value at Risk, and how VaR impacts riskiness in investment appraisals.
Was never prepared for it so left it

The normal loan was with annuity repayments and this made it more complex to calculate its tax reliefs.
I have calculated loan amortisation but forgot to add it in Npv calculations

2. Equity valuation of combined company, percentage gain for predator’s shareholders. Some discussions on this.
Was easy and attempted full

3. Interest rate hedging – forward vs futures.

Fra 4 v 9 Interest rate
Future contract used sept contract
Gain in contract
My calculations shows fra is lower than future contract

swaps left didn’t get time to attempt and

some quick discussion for information system integration and its impact on decentralised treasury departments.
I wrote afvantage n disadvantage of decentralisations

[Author]

Posts