Valuation of merged firm
Hi, everybody!
I am trying to do a case of merged Bulgari valuation.
Here is what I think basically:
1. to use DCF to calculate FCFF in 5 years based on preceding 3 years FCFF
2. Then to calculate WACC for the next 5 year.
3. finally to apply P=∑(FCFF_1)/(1+WACC)^1 +FCFF_(t+1))/[(WACC−g_n)(1+WACC)^t] to get the results
But then I'm stuck at the first step, because I don't know how to calculate change in NWC and CapEx from the annual report(attached). And the net cash at the end of the year 2009 and 2010 are all negative.
So overall, do you think the method and model I use are good for the valuation? or there are better options?
Thanks guys!
| Attachment | Size |
|---|---|
| 2010 BULGARI REPORT 2.09 MB | 2.09 MB |
*P=Sigma(FCFF_1)/(1+WACC)^1 +FCFF_(t+1))/[(WACC-g_n)(1+WACC)^t]
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