Discounted Cash Flow (DCF) Analysis Unlevered

Taro Pharmaceutical Industries Ltd. (TARO)

$30.93

-0.43 (-1.37%)
All numbers are in Millions, Currency in USD
Stock DCF: 46.61 | 30.93 | 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 661.91669.89644.77548.97561.35540.09519.64499.96481.02462.81
Revenue (%)
EBITDA 309.87375.36319.83-351.94103.77115.39111.02106.82102.7798.88
EBITDA (%)
EBIT 293.37356.76298.45-375.6277.8696.4792.8289.3185.9282.67
EBIT (%)
Depreciation 16.5018.6021.3823.6825.9118.9218.2017.5116.8516.21
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 1,422.621,049.331,108.741,023.66820.75946.46910.61876.13842.95811.03
Total Cash (%)
Account Receivables 323.17278.23264.15266.89292.48250.65241.16232.02223.24214.78
Account Receivables (%)
Inventories 144.60148.08153.07180.29210.44149.09143.44138.01132.78127.75
Inventories (%)
Accounts Payable 62.3467.0165.9761.1768.2357.1955.0352.9450.9449.01
Accounts Payable (%)
Capital Expenditure -29.54-30.68-28.41-17.15-12.04-20.22-19.45-18.72-18.01-17.33
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 30.93
Beta 0.734
Diluted Shares Outstanding 37.64
Cost of Debt
Tax Rate 25.16
After-tax Cost of Debt 3.74%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.163
Total Debt 2.20
Total Equity 1,164.24
Total Capital 1,166.44
Debt Weighting 0.19
Equity Weighting 99.81
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 661.91669.89644.77548.97561.35540.09519.64499.96481.02462.81
EBITDA 309.87375.36319.83-351.94103.77115.39111.02106.82102.7798.88
EBIT 293.37356.76298.45-375.6277.8696.4792.8289.3185.9282.67
Tax Rate 27.78%21.04%18.05%1.13%25.16%18.63%18.63%18.63%18.63%18.63%
EBIAT 211.87281.71244.58-371.3858.2778.5075.5372.6769.9167.27
Depreciation 16.5018.6021.3823.6825.9118.9218.2017.5116.8516.21
Accounts Receivable -44.9414.08-2.74-25.5941.839.499.138.798.45
Inventories --3.48-4.99-27.22-30.1561.355.655.435.235.03
Accounts Payable -4.67-1.04-4.807.07-11.04-2.17-2.08-2-1.93
Capital Expenditure -29.54-30.68-28.41-17.15-12.04-20.22-19.45-18.72-18.01-17.33
UFCF 198.83315.74245.60-399.6123.46169.3487.2583.9480.7677.70
WACC
PV UFCF 158.0375.9868.2261.2554.99
SUM PV UFCF 418.46

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.16
Free cash flow (t + 1) 79.26
Terminal Value 1,536.03
Present Value of Terminal Value 1,087.01

Intrinsic Value

Enterprise Value 1,505.47
Net Debt -248.93
Equity Value 1,754.40
Shares Outstanding 37.64
Equity Value Per Share 46.61