CA Final · Advanced Financial Management · Security Valuation
Vihaan Pharma Ltd has EV of ₹1,800 crore based on a peer EV/EBITDA multiple of 9 times. Its net debt is ₹500 crore and minority interest is ₹100 crore, and it has 20 crore shares. What is the equity value per share?
Equity value is enterprise value less net debt and minority interest. That is 1,800 minus 500 minus 100, equal to ₹1,200 crore. Dividing by 20 crore shares gives ₹60 per share.
- A₹60.00
- B₹50.00Correct
- C₹45.00
- D₹55.00
Explanation
Equity value = EV - net debt - minority interest = 1,800 - 500 - 100 = ₹1,200 crore. Per share = 1,200/20 = ₹60. Check: EBITDA = 1,800/9 = ₹200 crore, consistent. Ignoring minority interest gives ₹65; deducting only net debt is wrong. Correct is ₹60.
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