BBS stores – j 09 part b

[mansoor]

Sir

I may have a few followups after this one on this topic.

1. when he gives the gearing for the property market, he uses the term “gearing (adjusted for tax)”.

my question is: what does he mean by this? if i was to take a shot at it, i wd say that this is:

D(1-T) / [D(1-T)+E]. correct?

and since the tax thingy has been adjusted, that is why when we are calculating the asset beta, we do not use 50/50+.65×50.

is that correct?

[John Moffat]

That is correct 🙂

[Author]

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