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URK20CM3005 M CATHRINE

Equity share capital: Rs. 20,00,000 10% Preference Shares: Rs. 2,00,000 10% Debentures: Rs. 10,00,000 Cost of equity = Dividend/Price + Growth rate = (1.5/20) + 0.07 = 0.125 = 12.5% Cost of preference shares = Dividend/Issue Price*(1-Tax Rate) = 10%*(1-0.05) = 9.5% Cost of debt = Coupon Rate*(1-Tax Rate) = 10%*(1-0.5) = 5% Weighted average cost of capital = (Cost

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Equity share capital: Rs. 20,00,000 10% Preference Shares: Rs. 2,00,000 10% Debentures: Rs. 10,00,000 Cost of equity = Dividend/Price + Growth rate = (1.5/20) + 0.07 = 0.125 = 12.5% Cost of preference shares = Dividend/Issue Price*(1-Tax Rate) = 10%*(1-0.05) = 9.5% Cost of debt = Coupon Rate*(1-Tax Rate) = 10%*(1-0.5) = 5% Weighted average cost of capital = (Cost

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Equity share capital: Rs. 20,00,000 10% Preference Shares: Rs. 2,00,000 10% Debentures: Rs. 10,00,000 Cost of equity = Dividend/Price + Growth rate = (1.5/20) + 0.07 = 0.125 = 12.5% Cost of preference shares = Dividend/Issue Price*(1-Tax Rate) = 10%*(1-0.05) = 9.5% Cost of debt = Coupon Rate*(1-Tax Rate) = 10%*(1-0.5) = 5% Weighted average cost of capital = (Cost

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20 views9 pages

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URK20CM3005 M CATHRINE
Equity share capital: Rs. 20,00,000 10% Preference Shares: Rs. 2,00,000 10% Debentures: Rs. 10,00,000 Cost of equity = Dividend/Price + Growth rate = (1.5/20) + 0.07 = 0.125 = 12.5% Cost of preference shares = Dividend/Issue Price*(1-Tax Rate) = 10%*(1-0.05) = 9.5% Cost of debt = Coupon Rate*(1-Tax Rate) = 10%*(1-0.5) = 5% Weighted average cost of capital = (Cost

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BPCL BSE 100 Indices

MONTHS Open Close Adj. Cl Open Close Adj. Close

Apr-22 362 363.1 352.886 17730 17575 17575


May-22 366 326.4 317.218 17406 16888 16888
Jun-22 326.4 308.7 300.016 16889.5 16014 16014
Jul-22 310 330.4 321.106 15971 17530 17530
Aug-22 328.7 328.55 319.308 17607 18222 18222
Sep-22 326.9 304.9 301.536 18000 17575 17575
Oct-22 307 303.6 300.25 17571 18406 18406
Nov-22 304 341.2 337.435 18482 19081.7 19081.7
Dec-22 341.05 330.55 326.903 19154 18425 18425
Jan-23 330.55 343.25 339.462 18449 17936 17936
Feb-23 340.05 316.8 313.304 18063 17538.2 17538.2
Mar-23 317 344.05 340.254 17581 17602 17602

1.011063
RETURN INDEX
Chart Title
15.0000
-10.1074 -3.907
10.0000
-5.4228 -5.174
5.0000
7.0295 9.468
-0.5599 3.948 0.0000
1 2 3 4 5 6 7 8 9 10 1
-7.1983 -3.553
-5.0000
-0.4264 4.728
-10.0000
12.3847 3.671
-3.1213 -3.441 -15.0000

3.8421 -2.656 Column I Column J


-7.7058 -2.217
8.6016 0.362

1.01106318998 1.011063
101%
Title

6 7 8 9 10 11

Column J
INVOICE NO INVOICE DATEDUE DATE AMT TODAY DATE
1 12/28/2022 4/28/2023 2500 3/15/2024 CURRENT 0
2 11/5/2022 1/30/2023 9850 3/15/2024 CURRENT 0
3 10/30/2022 1/30/2023 7500 3/15/2024 CURRENT 0
4 10/26/22 1/26/2023 3500 3/15/2024 CURRENT 0
5 10/29/22 2/28/2023 7750 3/15/2024 CURRENT 0
6 10/25/22 2/25/2023 10250 3/15/2024 CURRENT 0
7 10/28/22 2/28/2023 14500 3/15/2024 CURRENT 0
8 11/27/22 3/30/2023 6100 3/15/2024 CURRENT 0
9 11/20/22 4/25/2023 12250 3/15/2024 CURRENT 0
10 12/20/22 4/20/2023 3250 3/15/2024 CURRENT 0
BELOW 0 BELOW 0-31 BELOW 31-60 BELOW 60-90 ABOVE 90
-322 2500
-410 9850
-410 7500
-414 3500
-381 7750
-384 10250
-381 14500
-351 6100
-325 12250
-330 3250

TOTAL 77450
MAX 77450 0 0 0 0
MIN 0
PROJEC INITIALNPV ACCEPT ANNUAL CAPITAL REQUIREMENT
A 100000 - 1 100000
B 1000000 - 1 1000000
C 500000 - 1 500000
D 30000 - 1 30000
E 10000 - 1 10000
F 30000 - 1 30000
G 900000 - 1 900000
H 2000000 - 1 2000000
I 300000 - 1 300000
J 60000 - 1 60000
K 600000 - 1 600000
L 400000 - 1 400000
M 500000 - 1 500000
N 10000 - 1 10000
6440000 6440000

yes

72316125
NPV CAITAL TEQIREMENT
₹ 3,367,080 6440000
₹ 5,299,641 6340000 10%
₹ 4,829,605 5340000
₹ 4,812,566 4840000
₹ 5,263,822 4810000
₹ 5,780,204 Err:522
₹ 6,328,225 Err:522
₹ 6,061,047 Err:522
₹ 4,667,152 Err:522
₹ 4,833,867 Err:522
₹ 5,257,254 Err:522
₹ 5,182,979 Err:522
₹ 5,301,277 Err:522
₹ 5,331,405 Err:522
Source of Funds Amount
(Rs)
Equity share capital 20,00,000
10% PreferShares 2,000,000
10% Debentures 10,00,000

Determine the Cost of Capital of equity, Cost of Preference Shares, Cost of Debt and Weighted Average
The floatation cost for preference share issue was estimated @ 5%. Find Cost of Preference Capital
if these shares were issued at par.

The next expected dividend for equity shares is Rs 1.50, the dividend is expected to grow @7%, the
market price per share is Rs 20.

(c) The tax rate applicable to the company in case of debentures is 50%, find the cost of debt if they
were issued at 10% premium.
1,900,000
200000
10.526%

f Debt and Weighted Average


ost of Preference Capital

pected to grow @7%, the

nd the cost of debt if they

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