DCF Projection !!

#1
Hi All

Can smbdy pls provide some material or hints as to how company revenue, PAT etc. are projected for the future using both DCF or simple projection

Waiting eagerly 4 a reply

regards
vizzie
 
#2
Hi All

Found the online version of damodaran's book .
One of the very few ones on this topic.
u can get it here .

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/valuation/val.htm

hope it helps

cheers
vizzie


vizzie said:
Hi All

Can smbdy pls provide some material or hints as to how company revenue, PAT etc. are projected for the future using both DCF or simple projection

Waiting eagerly 4 a reply

regards
vizzie
 
#8
cmlee said:
vizzie,
did you managed to get DCF Projection ?

Hi all !!

visited the thread after quite a time..
yes indeed, damodaran is probably the best of the bunch..
nice site , very informative..
would be gr8 if ivan or smone with the knowledge on DCF projections could share it with us here..

cheers
vizzie
 
#10
vizzie said:
Hi all !!

visited the thread after quite a time..
yes indeed, damodaran is probably the best of the bunch..
nice site , very informative..
would be gr8 if ivan or smone with the knowledge on DCF projections could share it with us here..

cheers
vizzie
Hi,

DCF projections are juggleries on the excel sheet ..the methid involves the following

1) Estimate future revenues/PAT/EPS based on historicals, ARs, 20 Fs, analyst reports, industry reports for "N" years.
2) Build up PnL, B/S
3) The trick is to get the right assumptions goin for growth
4) Get a discount rate to discount the estimated future revenues to arrive at the present value. The discount rate is a funtion of the Rf (risk free rate..lets say 10 yr GOI..current hovering at around 8%)
5) Divide the cumulative PV of your PAT for "N" years by the number of shares (assuming no equity dilution).
6) And voila u have the target price

The trcik here is to get your assumptions precise..so knowlede of the indsutry in which the enterprise is operating becomes important here.

ciao
Gaurav
 

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