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Exam Code: 300-435

Exam Name: Automating and Programming Cisco Enterprise Solutions

Certification Provider: Cisco

Related Certification: Automating and Programming Cisco Enterprise Solutions

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NEW QUESTION: 1
Section C (4 Mark)
Dinex Ltd, a leader in the development and manufacture of electronic devices, reported earnings per share of Rs 2.02 in 2003, and paid no dividends. These earnings are expected to grow 14% a year for five years (2004 to 2008) and 7% a year after that. The firm reported depreciation of Rs 2 million in 2003 and capital spending of Rs 4.20 million, and had 7 million shares outstanding. The working capital is expected to remain at 50% of revenues, which were Rs 106 million in 2003, and are expected to grow 6% a year from 2004 to 2008 and 4% a year after that. The firm is expected to finance 10% of its capital expenditures and working capital needs with debt. Dinex Ltd had a beta of 1.20 in 2003, and this beta is expected to drop to 1.10 after 2008. The current risk free rate is 7%.
Estimate the value per share today, based upon the FCFE model.
A. 37.5
B. 40.5
C. 35.05
D. 36.5
Answer: C


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