WACC Calculation

D/V
Kd
t
E/V
Rf
(Rm-Rf)
beta
Ke
WACC
Inflation rate

79%
7.75%
38%
21%
5.66%
6%
0.60
9.26%
5.74%
2%

Exhibit (3a) as per 31/3/99

Exhibit 5
Exhibit 5
Exhibit (3a) as per 31/3/99
Exhibit 6a (10 yr US treasury bill)
Exhibit 6a

in ($000)
Year 1
Year 2
Year 3
Capex
$
250,000 $
250,000
Cash Inflows
$
60,102
Terminal Value
$
1,305,679
NPV
$
748,368
*Terminal value was calculated using annuity of 30 years, assuming plant life of 30 years as plant is d
*Capex of $500mn is given in two years, we assumed it $250mn every year.

So this is a positive NPV project a

Annual Cash flow calculations for

CCGT plant ($000)
Gross Profit
70,057
Exhibit 5
Tax (@38%)
-26621.66
EBIAT
43,435.34
Depriciation
16667
Exhibit 5
Capex
0
Assumed
Delta NWC
0
Assumed
FCFF
60,102.34

Year 4
$

61,304

Year 5
$

62,530 $

Year 6
63,781 $

of 30 years as plant is depreciable for 30 years.

ear.

positive NPV project and hence attractive.

Year 7
65,057 $

Year 8
66,358 $

Year 9
67,685

Year 10
$

69,039

1234795