Discounted Cash Flow (DCF) Analysis Unlevered

Solvay SA (SOLB.BR)

100.7 €

+2.84 (+2.90%)

All numbers are in Millions, Currency in USD

Stock DCF: 271.06 | 100.7 | undervalue

Operating Data

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	11,299	11,227	9,714	11,435	16,071	17,844.64	19,814.03	22,000.77	24,428.85	27,124.89
Revenue (%)
EBITDA	2,105	1,564	493	2,014	3,163	2,674.19	2,969.32	3,297.03	3,660.90	4,064.93
EBITDA (%)
EBIT	1,161	532	-523	1,165	2,240	1,204.73	1,337.69	1,485.32	1,649.24	1,831.26
EBIT (%)
Depreciation	944	1,032	1,016	849	923	1,469.46	1,631.64	1,811.71	2,011.66	2,233.67
Depreciation (%)

Balance Sheet Data

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Total Cash	1,354	1,067	1,219	1,170	1,138	1,832.61	2,034.86	2,259.43	2,508.79	2,785.67
Total Cash (%)
Account Receivables	1,434	1,414	1,264	1,805	2,172.92	2,412.73	2,679.01	2,974.67	3,302.97	3,667.49
Account Receivables (%)
Inventories	1,685	1,587	1,241	1,745	2,109	2,505.64	2,782.17	3,089.21	3,430.15	3,808.71
Inventories (%)
Accounts Payable	1,439	1,277	1,197	2,131	2,296	2,475.22	2,748.40	3,051.72	3,388.52	3,762.48
Accounts Payable (%)
Capital Expenditure	-833	-857	-535	-636	-909	-1,132.47	-1,257.45	-1,396.22	-1,550.32	-1,721.41
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 100.7
Beta	1.319
Diluted Shares Outstanding	104.14
Cost of Debt
Tax Rate	11.44
After-tax Cost of Debt	3.53%
Risk-Free Rate
Market Risk Premium
Cost of Equity	9.706
Total Debt	2,960
Total Equity	10,487.22
Total Capital	13,447.22
Debt Weighting	22.01
Equity Weighting	77.99
Wacc

Build Up Free Cash

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	11,299	11,227	9,714	11,435	16,071	17,844.64	19,814.03	22,000.77	24,428.85	27,124.89
EBITDA	2,105	1,564	493	2,014	3,163	2,674.19	2,969.32	3,297.03	3,660.90	4,064.93
EBIT	1,161	532	-523	1,165	2,240	1,204.73	1,337.69	1,485.32	1,649.24	1,831.26
Tax Rate	-8.47%	-59.46%	-13.98%	13.35%	11.44%	-11.43%	-11.43%	-11.43%	-11.43%	-11.43%
EBIAT	1,259.34	848.32	-596.12	1,009.52	1,983.82	1,342.38	1,490.53	1,655.03	1,837.68	2,040.49
Depreciation	944	1,032	1,016	849	923	1,469.46	1,631.64	1,811.71	2,011.66	2,233.67
Accounts Receivable	-	20	150	-541	-367.92	-239.81	-266.28	-295.66	-328.29	-364.53
Inventories	-	98	346	-504	-364	-396.64	-276.53	-307.05	-340.94	-378.56
Accounts Payable	-	-162	-80	934	165	179.22	273.17	303.32	336.80	373.97
Capital Expenditure	-833	-857	-535	-636	-909	-1,132.47	-1,257.45	-1,396.22	-1,550.32	-1,721.41
UFCF	1,370.34	979.32	300.88	1,111.52	1,430.90	1,222.15	1,595.08	1,771.12	1,966.59	2,183.63
WACC
PV UFCF						1,127.97	1,358.71	1,392.39	1,426.91	1,462.29
SUM PV UFCF										6,768.27

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	8.35
Free cash flow (t + 1)	2,227.30
Terminal Value	35,075.58
Present Value of Terminal Value	23,488.77

Intrinsic Value

Enterprise Value	30,257.04
Net Debt	2,028
Equity Value	28,229.04
Shares Outstanding	104.14
Equity Value Per Share	271.06