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PVCF without growth
AFM
answered on 20-Oct-24 21:14
Hi sir, In this question, whether value with no growth for year 1 of ₹1400 should not be discounted at present value, Am I wrong sir , please clarify
latest answer
Why? P0= d1/(ke)
priyadharshini priya
CA Final
★ 2K+
1
278
Afm ACB
AFM
answered on 20-Oct-24 17:47
Both are similar question in one sum using EAC and another sum they are using npv for decision making
latest answer
there are 1 or 2 unique questions like Q 37 & 40 go through them
Ravi Teja
CA Final
★ 20
6
616
Dividend Computation
AFM
answered on 18-Oct-24 19:49
Hi Sir, In this question we have Calculated Dividend @ Nav Value at the time of Purchase, why it is not considered issue price as 10 for each of the MF funds, nowhere it is specified that NAV is the issue price. Please clarify
latest answer
Yes sir, you explained this earlier, I missed to see the word yield, Thank you sir
priyadharshini priya
CA Final
★ 2K+
2
291
Portfolio and futures
AFM
answered on 18-Oct-24 18:07
Both are similar type of beta hedging how to identify when to divest existing portfolio and invest in risk free and when to bring new risk free assets
latest answer
In exams Questions will be specific
Ravi Teja
CA Final
★ 20
1
714
why EBIT(1-T)
AFM
answered on 19-Oct-24 10:11
Sir i have Attached a scenario, where in we have only Interest and tax, and no depreciation, no capex changes and no W.C changes if using the formula if we calulate FCFF = EBIT(1-t) = 100(1-30%) = 70 Will be FCFF we understood the definition/meaning, FCFF is free cash flow avalaible to the firm (for all stakeholders inclduing lenders) if No tax at all then entire 100 belongs to the Firm, Now tax outflow which is 27, which is the only cash outflow, so 100-27 = 73 will be the Free cash flow available to the Firm, why is this difference in FCFF, when done considering the formula and when done logicaly ?
latest answer
First 2 paras are correct On making it complex - do not worry - clarity emerges from confusion put numbers in an excel and work them out under various methods - you will get a lot of clarity - may not be required fro exam but will stand you in good stead in your job
Hemachandra D
CA Final
★ 9K+
6
1K+
Equity Risk Premium vs Market Risk Premium and cosideration of beta accordingly
AFM
answered on 17-Oct-24 21:06
Sir I understand that when beta is not equal to 1, then Equity Premium = Beta (Rm - Rf) and Market Premium = Rm - Rf since in the question its given Equity Premium 6% and not market premium Rx = Rf + Equity Premium Rx = 4% + 6% = 10%, so Rx = ke we need to consider 10% if in the question if it was given "Market premium" = (Rm-Rf)= 6% then we need to do 4% + 1.2 * 6% = 11.2 % Am i right with my understanding ?
latest answer
Question is mkt risk premium. I read it out correctly as risk premium By mistake got typed on screen as eq risk premium Will get it corrected Thanks for highlighting Your understanding is correct
Hemachandra D
CA Final
★ 9K+
1
843
is it P0 or P1
AFM
answered on 17-Oct-24 17:59
Sir in the question they have asked whats the market price "at the end of the year" I inderstand current market price means P0, if they are asking for end of the year isn't it they are asking P1 or how to intrepret this at the end of the year, beacause in all other questions it was mentioned to calulate current market price
latest answer
P0 or p 1
Hemachandra D
CA Final
★ 9K+
1
1K+
From practical aspect
AFM
answered on 17-Oct-24 17:56
sir will these walters and gordon's model used in real life ?, because in this question we got P0 = Rs 233 using gordon's formula, andP0= Rs 77.77 using walters formula, big difference of the price using different approaches, so a doubt
latest answer
Practically Walter or Gordon
Hemachandra D
CA Final
★ 9K+
1
530
Calculation of in RTP is wrong?
AFM
answered on 16-Oct-24 22:07
Sir, as per illustration 29, we are taking back for 914 that is after bad debt provision net of taxes, but now as per RTP, they have did gross as well as in WACC calculation, they did not take the provisional equity. You can find the image. Please suggest.
latest answer
That is so unfortunate and patently incorrect solution by the institute ideally examiners should give marks based on the logical solution of adjusting tax and non cash items everywhere I would suggest that you make suitable assumptions in exam and if time permits give both solutions
kabilan sam
CA Inter
★ 3K+
1
572
Doubt on yield
AFM
answered on 16-Oct-24 21:32
Sir in this sum during last year annualised yield is 73.52% and we do consider it of 33 months (73.52*3*33\36) comes to 202.18% why are we not reducing the dividend received 30% as we did for earlier year? Please clarify sir
latest answer
Sir really great sir🙏🏼🙏🏼,
kabilan sam
CA Inter
★ 3K+
2
506