AssumptionsInvestmentYr012Invst(billion)210.5Year of Completion3Yr 3 onwardsDepreciation Amount(Bil)2.5

Market Survey Cost (Initial Cost Mil)200Yr01234567891011121314Market Size72.0076.3280.9085.7590.9096.35102.13108.26114.76121.64128.94136.68144.88153.57162.79Growth6%

Market Share GAPYr 345678910111213142%2.5%3.0%3.5%4.0%4.5%5.0%5.0%Increase0.50%0.50%0.50%0.50%0.50%0.50%StableSales1.722.272.893.574.335.166.086.456.837.247.688.14EBITDA Margin30%

S&GACurrent3bilGrowth for 12 yrs5%p.aAllocation10%of total

Gen and AdminYr 3 100milAs a % of Rev6%

Yr01234567891011121314S and GA33.153.313.473.653.834.024.224.434.654.895.135.395.395.39Allocated for New SGA0.350.360.380.400.420.440.470.490.510.540.540.54G and A0.100.130.170.210.250.300.350.380.400.420.450.47Total Allocated Cost0.450.500.550.610.670.740.820.860.910.960.991.01Distr Capacity Util70%Increase every year3.50%New Business8%of Total CapacityCapacity Expansion cost1(yr 3)Inflation2%DDB Depreciation20yrsAdvertising ExpCurrent1bnIncr5%12 yrsYr 3 onwards10%addnl exp

Yr01234567891011121314Expense1.001.051.101.161.221.281.341.411.481.551.631.711.801.891.98Addnl Advert0.120.120.130.130.140.150.160.160.170.180.190.20Total Advert1.001.051.101.271.341.401.471.551.631.711.791.881.982.072.18

WC DetailsA/C Receivable5%RevenueInv20%COGSCredit Offered8%COGSBeta1.04RatingBBB-Default Spread1.65%

Stk Price39.9Shares Out446MilCapital StructureDebt1394MilMaturity6yrsInterest61MilTAX RATEEffective38.80%Marginal40%

US Govt Bond Rate2.5%Expected Inflation2%

Lease Obligation2014110520151087201691520177382018586Thereafter1716Total Minimum6147working capitalyears0123456789101112131415Accounts recivables0000.0857531520.11362292640.14452836240.17873340810.21652275730.25820338810.30410621260.32235258540.34169374050.36219536490.38392708680.406962712Inventory0000.08945750.0994303750.11028489380.12209129840.13492510380.14886747760.16400564860.17291519060.18231276520.19222532750.19729376440.2026663075Payables0000.0357830.039772150.04411395750.04883651940.05397004150.0595469910.06560225940.06916607620.07292510610.0768901310.07891750580.081066523Working capital0000.1394276520.17328115140.21069929860.25198818720.29747781960.34752387460.40250960180.42610169970.45108139960.47753056140.50230334550.5285624965Growth rate in steady state3%RF2.5%Beta1.04Rm9.05%A.Damodaran India Equity Risk Premium Cost of Equity11.91%Cost of Debt4.1500%Equity Market value17795.4mnDebt value1394mnD/E0.0726442724WACC11.35%

Depreciation

012345678910STRAIGHT LINE10%11%13%14%17%20%25%33%50%100%DOUBLE DECLINING20%

INVESTMENT2000500BOOK VALUE:BEG20001600168013441075.2860.16688.128516.096344.064172.032DEPRECIABLE BV20002100168013441075.2860.16688.128516.096344.064172.032DDB DEPRECIATION400420336268.8215.04172.032137.6256103.219268.812834.4064STL DEPRECIATION200233.3333333333210192179.2172.032172.032172.032172.032172.032DEPRECIATION USED400420336268.8215.04172.032172.032172.032172.032172.032NET BOOK VALUE1600168013441075.2860.16688.128516.096344.064172.0320

DISTRIBUTION CAPACITY70.0%73.5%77.0%88.500%92.0%95.5%99.0%100.0%

INVESTMENT REQUIRED100010201040.41061.2081082.432161104.08080321126.1624192641148.6856676493

TIME LINE FOR DEPRECIATION01234567891011121314151617181920

DOUBLE DEPRECIATION 114.87 103.38 93.04 83.74 75.37 67.83 61.05 54.94 49.45 44.50 40.05 36.05 32.44 29.20 26.28 23.65 21.29 19.16 17.24 15.52

TIME PERIOD0123456789101112131415161718192021222324252627FINAL DEPRECIATION In Bil0.400.420.340.270.220.170.170.290.280.270.080.080.070.060.050.050.040.040.040.030.030.030.020.020.020.020.02

Accounting ReturnsYear01234567891011121314Revenue0001.722.272.893.574.335.166.086.456.837.247.688.14EBITDA0.00.00.00.510.680.871.071.301.551.821.932.052.172.302.44Depreciation00.400.420.340.270.220.170.170.290.280.270.080.080.070.06Allocated Cost00.00.00.450.500.550.610.670.740.820.860.910.960.991.01Advertising Expense0.00.00.00.120.120.130.130.140.150.160.160.170.180.190.20Operating Income(EBIT)0.0-0.40-0.42-0.38-0.21-0.030.160.310.370.570.640.880.961.061.17Interest Expense0.0610.0610.0610.0610.0610.061000000000PBT-0.06-0.46-0.48-0.45-0.27-0.090.160.310.370.570.640.880.961.061.17TAX-0.020.00.00.00.00.00.060.120.140.220.250.340.370.410.45PAT-0.04-0.46-0.48-0.45-0.27-0.090.100.190.230.350.390.540.590.650.72

Capital Invested210.51Total Capital Invested233.53.53.53.53.53.54.54.54.54.54.54.54.5Return on Capital-1.9%-15.4%-13.7%-12.7%-7.6%-2.5%2.7%5.5%5.0%7.8%8.7%12.0%13.0%14.4%15.9%

Cash Flow Analysisworking capitalAccounts recivables0000.0857531520.11362292640.14452836240.17873340810.21652275730.25820338810.30410621260.32235258540.34169374050.36219536490.38392708680.406962712InventoryPayablesWorking capital0

Year01234567891011121314Net Income-0.04-0.46-0.48-0.45-0.27-0.090.100.190.230.350.390.540.590.650.72Depriciation0.000.400.420.340.270.220.170.170.290.280.270.080.080.070.06Capex210.51Change in WC000.1394276520.03385349940.03741814720.04128888860.04548963230.05004605510.05498572710.02359209790.02497969990.02644916180.0247727840.0262591511Salvage Value0CFE-2.04-1.06-0.56-0.25-0.030.090.230.32-0.540.570.630.600.630.690.75NPV($2.17)IRR

Years0123456789101112131415Net Income-0.04-0.46-0.48-0.45-0.27-0.090.100.190.230.350.390.540.590.650.720.7371465827Depriciation0.000.400.420.340.270.220.170.170.290.280.270.080.080.070.060.06Capex210.51Change in WC000.1394276520.03385349940.03741814720.04128888860.04548963230.05004605510.05498572710.02359209790.02497969990.02644916180.0247727840.02625915110.0262591511Salvage Value0CFE-2.04-1.06-0.56-0.25-0.030.090.230.32-0.540.570.630.600.630.690.750.77Terminal Value9.25CFE-2.04-1.06-0.56-0.25-0.030.090.230.32-0.540.570.630.600.630.6910.00NPV($0.33)IRR