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vedantbindal
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Asked: 2025-08-26T20:27:05+05:30 In:

Equity Valutaion Q57 Class 7

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Sir has told us that we will consider present value of cashflows instead of NPV to arrive at the new market cap when the no. of shares are changing (like in right issue) but then why in Q57 we add the NPV of the expansion scheme as well as the NPV from bond redemption in the existing market cap to arrive at the new market cap

class 7 equity valuationquestion
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      If shares are unchanged → Add/subtract NPVs to old market cap.

      If shares are changing → Compute PV of new cashflows, then divide by new shares to get share price, then find market cap.

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