Dividend growth model and Market value

Hello Sir, Analysing Question 317 in the Kaplan exam kit 2022-2023 part A (ii) Do the dividend growth model means the cost side of the valuation of the company if we use it to value the shares of the company because the market value of Danoca Co is $16.5m ($3.30 × 5m) using the market price ex div and since the valuation using the growth model  of Danoca Co was  = $2.95 × 5m = $14.75 million  which is lesser than the market value by 16.5-14.75=$1.75m So can I assume that the growth model showing cost side of the company value which is different and could be lower than the market value of the company. Thanks ------------------- Q 317  PHOBIS (DEC 07 – MODIFIED)   (a)  Phobis Co is considering a bid for Danoca Co. Both companies are stock market listed  and are in the same business sector. Financial information on Danoca Co, which is  shortly to pay its annual dividend, is as follows:  Number of ordinary shares  Ordinary share price (ex div basis)  Earnings per share  Proposed payout ratio  Dividend per share one year ago  Dividend per share two years ago  Equity beta    Other relevant financial information  Average sector price/earnings ratio  Risk?free rate of return  Return on the market  5 million  $3.30  40.0c  60%  23.3c  22.0c  1.4      10  4.6%  10.6%  Required:  Calculate the value of Danoca Co using the following methods:  (i)  price/earnings ratio method  (ii)  dividend growth model  and discuss the significance, to Phobis Co, of the values you have calculated, in  comparison to the current market value of Danoca Co.