Discounted Cash Flow (DCF) Analysis Unlevered

Afya Limited (AFYA)

$12.93

+0.28 (+2.13%)

All numbers are in Millions, Currency in USD

Stock DCF: 698.35 | 12.93 | undervalue

Operating Data

Year A/P	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Projected	2023 Projected	2024 Projected	2025 Projected	2026 Projected
Revenue	216.01	333.93	750.63	1,201.19	1,719.37	2,933.85	5,006.18	8,542.29	14,576.15	24,872.03
Revenue (%)
EBITDA	52.96	101.82	296.71	497.89	584.37	997.36	1,701.84	2,903.94	4,955.14	8,455.21
EBITDA (%)
EBIT	48.94	92.74	223.56	389.14	430.15	807.54	1,377.95	2,351.27	4,012.10	6,846.05
EBIT (%)
Depreciation	4.02	9.08	73.15	108.74	154.22	189.81	323.89	552.67	943.05	1,609.17
Depreciation (%)

Balance Sheet Data

Year A/P	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Projected	2023 Projected	2024 Projected	2025 Projected	2026 Projected
Total Cash	25.49	62.26	943.21	1,045.04	748.56	1,681.91	2,869.92	4,897.09	8,356.16	14,258.53
Total Cash (%)
Account Receivables	32.74	60.71	131.92	323.34	403.93	594.53	1,014.47	1,731.05	2,953.77	5,040.17
Account Receivables (%)
Inventories	0.45	1.11	3.93	7.51	11.83	13.95	23.81	40.63	69.33	118.30
Inventories (%)
Accounts Payable	6.74	96.97	149.51	224.16	298.95	517.10	882.35	1,505.59	2,569.07	4,383.73
Accounts Payable (%)
Capital Expenditure	-21.07	-21.69	-121.71	-137.59	-276.80	-352.14	-600.88	-1,025.31	-1,749.55	-2,985.34
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 12.93
Beta	0.849
Diluted Shares Outstanding	94.10
Cost of Debt
Tax Rate	18.33
After-tax Cost of Debt	6.64%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.762
Total Debt	2,161.69
Total Equity	1,216.76
Total Capital	3,378.44
Debt Weighting	63.98
Equity Weighting	36.02
Wacc

Build Up Free Cash

Year A/P	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Projected	2023 Projected	2024 Projected	2025 Projected	2026 Projected
Revenue	216.01	333.93	750.63	1,201.19	1,719.37	2,933.85	5,006.18	8,542.29	14,576.15	24,872.03
EBITDA	52.96	101.82	296.71	497.89	584.37	997.36	1,701.84	2,903.94	4,955.14	8,455.21
EBIT	48.94	92.74	223.56	389.14	430.15	807.54	1,377.95	2,351.27	4,012.10	6,846.05
Tax Rate	10.96%	12.53%	17.66%	12.83%	18.33%	14.46%	14.46%	14.46%	14.46%	14.46%
EBIAT	43.57	81.12	184.07	339.23	351.29	690.75	1,178.67	2,011.22	3,431.85	5,855.94
Depreciation	4.02	9.08	73.15	108.74	154.22	189.81	323.89	552.67	943.05	1,609.17
Accounts Receivable	-	-27.97	-71.21	-191.41	-80.59	-190.60	-419.94	-716.57	-1,222.73	-2,086.40
Inventories	-	-0.67	-2.82	-3.58	-4.32	-2.13	-9.86	-16.82	-28.70	-48.97
Accounts Payable	-	90.23	52.54	74.65	74.78	218.15	365.25	623.25	1,063.48	1,814.66
Capital Expenditure	-21.07	-21.69	-121.71	-137.59	-276.80	-352.14	-600.88	-1,025.31	-1,749.55	-2,985.34
UFCF	26.53	130.11	114.02	190.05	218.58	553.85	837.13	1,428.43	2,437.40	4,159.06
WACC
PV UFCF						517.42	730.63	1,164.72	1,856.70	2,959.82
SUM PV UFCF										7,229.29

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.04
Free cash flow (t + 1)	4,242.24
Terminal Value	84,171.52
Present Value of Terminal Value	59,901.08

Intrinsic Value

Enterprise Value	67,130.38
Net Debt	1,413.13
Equity Value	65,717.25
Shares Outstanding	94.10
Equity Value Per Share	698.35