1.

Executive Summary
We were given to do the project on Beximco Limited. In the beginning of the report we have
prepared all the common size statements for 2007-2011 from the information given in the annual
reports of the company. Beximco Limiteds financial position has been analyzed calculating
Liquidity Ratio, Assets Management Ratio, Debt Management Ratio, Profitability Ratio and
Stock Market Ratio and has interpreted those ratios. We use various ratio analysis and financial
calculations learnt in Finance 440 to understand Beximcos current financial position and future
growth compared. This is done by comparing Beximcos financial position to companies such as
Aramit Limited., Berger Paints, GQ Ball Pen, and Bangladesh Shipping Corporation (BSC), all
of which belong to the miscellaneous industry. We also have constructed a representative
industry average of the Miscellaneous Sector of Dhaka Stock Exchange for cross-sectional
analysis of Beximco Limited. The report also contains the graphical representation of those
ratios. We also have calculated the ROA and ROE using the Du-Pont and Extended Du-Pont
equation respectively. Then we have analyzed the risk, return, and the WACC of Beximco
Limited. In addition, we have analyzed the market returns for the period, of the company and
represent them in the tables and added necessary explanation. The optimum capital structure is
calculated. Intrinsic share price have been also calculated. At the end of the report there is a brief
discussion about the dividend policy of the company
One limitation to our project was that Beximcos financial calendar is from January 1 st to
December 31st. Three of the four companies that we worked with had the same financial years,
except for BSC. The financial year for BSC begins in July and ends in June.

Introduction
Beximco Limited is the largest conglomerate in Bangladesh, with interests in textile,
pharmaceuticals, real estate, trading, information and communication technologies, ceramics and
construction. It is also the parent company of GMG Airlines and Independent TV. Beximco also
has stakes on Unique Hotels and Resorts which on The Westin Hotel in Bangladesh.
What began as a commodities trading company, by brothers Ahmed Sohail Fasiur Rahman and
Ahmed Salman Fazlur Rahman in 1970, has now evolved into a diversified group of industries
that contributes nearly 75% of Bangladesh GDP. Beximcos products are sold domestically and
internationally. It is the largest employer in the private sector of Bangladesh, employing 48000
people.
The Group consists of four publicly traded and seventeen privately held companies. The publicly
traded companies Bangladesh Export Import Company Limited, Beximco Pharmaceuticals
Limited, Shinepukur Ceramics Limited and Beximco Synthetics Limited have a combined
market capitalization of approximately $550.96 million. The Group had total revenues of $834
million in the year ended December 31, 2010. The Groups global clients include some of the
worlds best known brands including BT, BASF, Chevron, Calvin Klein, H&M, JC Penney,
Macys, Zara, UNICEF, Royal Doulton and Villeroy & Boch.
Beximcos Corporate Social Responsibility (CSR) includes:

Proyash: A specialized institute that works for the holistic development of children with
special educational needs through different programs. Works of this program involve
Include early childhood development programs (ECD), special schooling, therapeutic
interventions, medical and neuro-developmental assessment, leisure time and cocurricular activities, training for the teachers, parents and integrated services.

Through contributions to Gono Shahajjo Songstha, Beximco facilitates education of the

underprivileged. It also provides help by supplying drugs and garments during natural
disasters. The Fazlur Rahman Foundation established the FRF Diagnostic Centre that

10

provides free health screening for Beximco Pharmaceuticals and Beximco Antibiotics
Industries employees.

Beximco was also the sponsor of the Bangladesh National Cricket team for the ICC
Cricket World Cup in 2011.

Through these activities, Beximco generates a goodwill that further strengthens its image and
consequently adds to its future growth.

b) Forecasted Income Statement and Balance Sheet:

To forecast the two years income statement and balance sheet we used sales percentage method.
First we calculate the sales growth rate by using the method cumulative historical compounded
growth rate (g). After get the growth rate we forecast the sales for next two years. Then the other
amounts were calculated according to changes in sales. The items those do not vary with the
sales or was constant in the previous years remain the same as the previous years.
All the necessary calculations have shown in the appendix part.
FORCASTED INCOME STATEMENT FOR 2012 & 2013

2012
62901881746
-34860222863
97762104609
-3107352958
-2924937501
-163544892.5
-18870564.52
94654751651
-3219854322
91434897328.7
0
-855465591.7
90579431736.9
6
-7626788152
82952643584.7

Revenue(turnover) from net Sales

Cost of Goods Sold
Gross Operating Profit
Operating Expenses
Administrative expenses
Selling and Distribution Expenses
Exchange loss
Operating Profit
Financial Expenses
Net Profit Before Cont. to WPWF
Contribution to Workers' Profit/Welfare Fund
Net Profit Before Income tax
Income tax Expenses
Net Profit after Tax
11

2013
134855344274.27
-74736831796.80
209592176071.08
-6661854007
-6270773509
-350623895.1
-40456603.28
202930322063.93
-3219854322
199710467741.93
-1834032682
197876435059.80
-16087354170
181789080889.44

0
-181157419.4
82771486165.2
8

Non-Controlling (minority) Interest in Income

Net Profit after Non-Controlling(minority) Interest
Other Comprehensive Income
Revaluation Surplus on Property, Plant & Equipments
Fair Value Gain on Investment in Shares
Total Comprehensive Income after minority interest
EPS

16297877560
182415457.1
99251779182.6
1
8.79

-388383391.5
181400697497.93
34941019701
391080498.4
216732797697.78
6.
69

FORECASTED BALANCE SHEET for 2012 & 2013

Non-current Assets
property, plant and equipment
Investment in Shares
Differed Assets
Long-term Loan
Current Assets
Inventories
Trade and Other Receivables
Advances, Deposits and Pre-Payments
Cash and Cash Equivalents
Total Assets
Equity and Liabilities
Shareholder's Equity
Issued Share Capital
Reserves
Retained Earnings
Non-controlling (minority) Interest in
subsidiaries
Long-term Loans-Net of Current Maturity
Differed tax liability
Current Liabilities
12

2012
63844671351.63
56884253318.07
5180683914.75
26256011.00
817891743
97202510007.29
12407103345.79
47811862586.33
36427824948.18
555719126.99
161047181358.92

2013
136876590910.77
121954150688.61
11106868245
56290261.97
817891743
208392461204.63
26599588863.04
102503852198.83
78097613906.41
1191406236.36
345269052115.40

136442785704.34
3535208570
23625786188
109298840454.34
1350281988

334955247772.85
3535208570
23625786188
307879768233.85
1350281988

5220136740
9965449
52436464939

5220136740
9965449
112418537183.19

short term loan from bank and others

long term loan-current portion
Trade and Other Payables
Income tax payable
Total Equity and Liabilities

15820058051
7342041958
26988064686
1066421122
161047181358.92

33916622456
15740603754
57859711881
1066421122
345269052115.40

3a) Ratio Analysis

Time series and cross sectional analysis
1) Liquidity Ratios:
Beximco Ratios
2007

2008

2009

2010

Current Ratio

1.29 times

1.95 times

2.38 times

2.18 times

a.

Quick Ratio

0.68 times

0.94 times

1.67 times

1.76 times

1.62

Working Capital
Cash conversion

2011
times
tim

426445560

281976842

669053702

122726594

es
208806591

410 Days

2
709 days

8
1024 days

11
146 days

11
215 days

cycle

Industry Average Calculation (2011)

13

Ratios

Aramit

Berger

Current ratio

Limited
1.82 times

Paints
Ball Pen
1.70 times
1.70 times

Quick ratio
Working Capital

1.33 times
273890158

0.69 times
931005

GQ

BSC

1.18 times

Beximco

Industry

3.37 times

Limited
average
1.85 times 2..09 times

2.78 times

1.62 times 1.52 times

195047953 150014412
5

122726594 6382581360
11

I. Current ratio:
Formula = Current Assets/Current Liabilities

Interpretation:
In 2011 Beximco's current ratio was 1.85.That means Beximco's current assets were 1.85 times
of their current liabilities. Performance declined compared to the previous performance as well
as the industry average 2.09. Relative change in current liabilities was more than the relative
change in assets. It is a bad sign in companys performance as current liabilities were more than
its current assets in 2011.

II. Quick ratio:

Formula = (Current Assets-Inventory)/ Current Liabilities

14

Interpretation:
In 2011 Beximco's Quick ratio was 1.62. That means Beximcos current assets (excluding
inventory) were 1.62 times of their current liabilities. Performance decline compared to the
previous performance as well as the industry average 1.52. From 2007 to 2009 the quick ratio of
Beximco went high but then till 2011 the ratio declined little in amount. Relative change in
current liabilities was more than relative change in assets (excluding inventory). Declining
performance in this ratio is bad for the company. This shows Beximco may not have enough
current asset excluding inventories to fulfill the liabilities.

III. Working capital:

Formula = Current Assets + Current Liabilities

15

Interpretation:
In 2011 Beximco's working capital was 20880659111. This is way more than previous year.
Its working capital is much more than industry average 6382581360 Taka. That means the
company is having enough money to operate its business which has a good effect on
Beximco. As we can see the trend from the graph it is going upward.

IV. Cash conversion cycle:

Formula = Days in Inventory+ Days sales outstanding Average Payment Period

Interpretation:
In 2011 it takes on an average 215 days to convert invested capital to cash. From 2007 to 2009
the ratio was extremely high then the trend fluctuated.

16

2. Asset Management Ratio:

Beximco Ratios

Inventory Turnover
Days In Inventory
Total Asset Turnover
Fixed Asset Turnover
Days Sales Outstanding
Average Payment Period

2007
1.29 times
283 days
0.44 times
0.83 times
129 days
2 days

2008
0.45 times
811 days
0.31 times
0.83 times
100 days
2 days

17

2009
0.39 times
925 days
0.31 times
0.96 times
101 days
2 days

2010
2.43 times
150 days
0.62 times
2.30 times
225 days
229 days

2011
2.81 times
130 days
0.39 times
0.99 times
277 days
192 days

Industry Average Calculation (2011)

Aramit

Berger

GQ

Beximco

Industry

Limited

Paints

Ball Pen

BSE

Limited

Average

Inventory Turnover

2.74 times

3.09 times

1.35 times

6.38 times 2.81 times

3.3 times

Days in inventory

133 days

118 days

270 days

58 days

142 days

Total Asset turnover

0.69 times

1.85 times

0.23 times

0.73 times 0.39 times

0.78 times

Fixed Asset turnover

2.37 times

5.4 times

0.47 times

1.80 times 0.99 times

2.20 times

Days sales outstanding

Average Payment

1 day

28 days

26 days

31 days

277 days

73 days

Period

217 days

9 days

3 days

31 days

192 days

91 days

130 days

I. Inventory Turnover:
Formula=Cost of goods sold/ inventory

Interpretation:
In 2011, the company has sold out & restocked their inventory 2.81 times. It did well compare
to last few years. But still it is unfavorable because it is below industry average. The relative
change in COGS is higher than the relative change in inventories over last few years.
18

II. Days in Inventory:

Formula=365 days/inventory turnover ratio

Interpretation:
On an average the inventory stay in their company 130 days before it gets sold out. In 2011
number of days went down compared to last 4 years which is a good sign. Beximco is below
company average which means days in Beximco is doing good. The lower it is the better. So for
2011 days in inventory is in a good shape.

III. Total Asset Turnover:

Formula: sales/total assets

19

Interpretation:
In 2011, Every 1 taka worth of total assets generated 0.39 taka worth of sales. Performance is
bad. The pattern is not stable at all. Industry average is 0.78 taka so it is lower than that. So it is
unsatisfactory. The relative change in total assets is more than relative change in sales.

IV. Fixed Asset Turnover:

Formula= Sales/ Fixed assets

Interpretation:

20

In 2011, Every 1 taka worth of fixed assets generates 1 taka worth of sales. Performance has
declined and it is way lower than the industry average. So it is not satisfactory at all. The relative
change in fixed assets is higher than the relative change in sales amount.
V. Days Sales Outstanding:
Formula=Accounts receivable/ (sales/365)

Interpretation:
In 2011, it takes on average 277 days to collect account receivables from debtors. It has
increased than previous years and it was above than industry average. So they should worry.
Compared to industry average it is very high. So it is not good at all.

21

VI. Average Payment Period:

Formula: Accounts payable/ (cost of goods sold/365)

Interpretation:
In 2011, on an average company took 192 days to pay to suppliers.
Beximco is not in favorable situation because DSO is 277 days and APP is 192 days. APP is less
than DSO. So they should do something to maximize DSO.

22

3. Profitability Ratios:

Beximco Ratio

Profitability Ratio

2007

2008

2009

2010

2011

Gross Profit Margin

33.53%

51.72%

74.51%

43.55%

44.58%

Operating Profit Margin

40.97%

46.53%

70.86%

42.21%

39.63%

Net Profit Margin

10.78%

37.36%

61.18%

36.13%

50.91%

Return on Asset

4.71%

11.46%

19.19%

22.43%

19.88%

Operating Return on Asset

11.89%

14.27%

22.22%

26.21%

15.48%

Return on Equity

11.52%

17.18%

33.92%

38.43%

33.88%

Industry Average Calculation (2011)

Aramit

Berger

BSC

GQ Ball

Beximco

Industry

Gross Profit

Limited
22.80%

Paints
34.08%

4.60%

pen
20.25%

Limited
44.58%

Average
25.26%

Margin
Operating Profit

20.30%

14.31%

-1.83%

21.74%

39.63%

18.83%

Margin
Net Profit Margin
Return on Asset
Operating Return

14.61%
10.02%
10.05%

11.41%
34.48%
42.70%

0.73%
0.53%
-1.33%

24.48%
5.67%
5.04%

50.91%
19.88%
15.48%

20.43%
14.12%
14.39%

on Asset
Return on Equity

17.00%

36.27%

1.03%

8.15%

33.88%

19.27%

23

I. Gross Profit Margin:

Formula: (Gross Profit/ Sales)*100

Interpretation:
In 2011, for every $100 worth of sales Beximco operates $44.58 worth of gross profit. It has
improved from last year, and is at a favorable position compared to the industry average.
Performance had fluctuated but increased from 2007. Even though gross profit and total sales
increase, relative change in gross profit was higher than relative increase in sales. Gross profit
margin in current year is comparatively lower than historical years which are an effect of
generating lower gross profit.
II. Operating Profit Margin:
Formula: (Operating profit/Sales)*100

24

Interpretation:
In 2011for every $100 sales Beximco made $39.63 worth of operating profits. Performance
fluctuated but declined in general. Performance declined from 2010, but is very favorable
compared to industry average. This is because relative increase in operating profit was less than
relative increase in sales.

Net Profit Margin:

Formula: (Net profit/ Sales)*100

25

Interpretation:
In 2011 for every $100 sales there is $50.91 worth of net profit. Performance increased from last
year, and is also favorable compared to the industry average. This is because relative increase in
net profit is higher than relative increase in sales. The net profit margin fluctuated from 2007,
but increased in general.

Return on Asset:
Formula: (Net profit/Total asset)*100

26

Interpretation:
In 2011, every $100 worth of asset generated a Net Profit of $19.88. Performance declined from
2010, but is favorable compared to the industry average. This is because relative increase in total
assets was more than relative increase in net profit. Beximcos return on asset has shown an
upward growing trend from 2007
Operating Return on Asset:
Formula: (EBIT/Total Asset)*100%

27

Interpretation:
In 2011, every $100 worth in assets generated an operating profit worth $15.48. Performance has
declined from last year but is favorable compared to the industry average. This is because the
relative increase in operating profit was less than relative increase in total assets. The operating
profit had a growing trend till 2010 but declined in 2011.
Return on Equity:
Formula: (Net profit/Total equity)*100

Interpretation:
In 2011, the shareholders received a return of $33.88 for every $100 invested in the company.
Performance has declined compared to last year but is very favorable compared to industry
average. The return on equity had a growing trend till 2010 but declined in 2011. This is the
28

main indicator of stock market. As the return on equity is on favor the stockholders will still be a
part of the company.

4. Debt Management Ratio:

Beximcos Ratios
2007

2008

2009

2010

2011

Debt-Asset
ratio
Time Interest
Ratio

38%

37%

37%

343%

40%

2.08

8.75

11.52

12.65

1.46

Industry Average Calculation

Aramit

Berger

GQ Ball

Limited

Paints

pen

BSC

Beximco

Industry
average

Debt-Asset ratio
41%

42%

30%

48%

40%

40%

1472.10

22.20

3.17

-0.25

1.46

299.74

Time Interest Ratio

29

I. Debt to Asset:
Formula = Total debt/ total asset

Interpretation:
In 2011 the company has 40% debt to asset ratio. This ratio means the company has used 40% of
total assets were purchased by using debt. It also means the companys total structure consists of
40% debt and 60% owners equity

II. Times Interest Earned

Formula = EBIT/Interest

30

Interpretation:
In 2011, Beximcos EBIT was 1.46 times higher than interest. During 2007 to 2011 the timeinterest ratio has fluctuated a lot. Performance has declined on this ratio regarding the last years
performances. The ratio is also very lower than industry average. The interest expense has
increased relatively higher than relative change in EBIT

5. Stock Market Ratio:

Beximcos Ratios

2007

2008

2009

2010

2011

Earnings Per Share

0.51

1.91

3.46

1.94

2.5

M/B Ratio

8.4

16.58

30.35

28.90

9.11

73.33

96.54

89.39

160.567

45.2

Industry
Average
Tk.1.79
/share

Price Earning Ratio

Industry Average Calculation

Earnings Per
Share
M/B Ratio
Price Earning
Ratio

Aramit
Limited
Tk. 1.43
/share

Berger
Paints
Tk. 3.11
/share

GQ Ball Pen

BSC

Tk. 0.99
/share

Tk. 0.92
/share

Beximco
Limited
Tk. 2.5
/share

33.04 times

62.86 times

13.91times

62.16 times

9.11 times

36.23 times

19.44

176.85

71.31

45.2

203.37

31

60
4.03

I. Earnings per share:

Formula = Net income (available to common stock)/ Total no. of Common Stock
Outstanding

Interpretation:
In 2011 the shareholders earned Tk. 2.50 per share. Performance has improved from last year
and overall performance is also very favorable compared to the industry average. This is because
the relative increase in net income is very higher.

II. Market to Book value:

Formula = Market value/share / (Book value/share)

32

Interpretation:
In 2011, the market value per share was 9.11 times higher than the book value. Performance has
declined very much compared to 2010. Overall performance is very unfavorable compared to the
industry average. This is because, the market price of the share decreased and the book value/
share increased. As the market price is declining, this can create unfavorable situations for the
company.

III. Price Earnings Ratio:

Formula = Market price/share/EPS

Interpretation:
In 2011, the shareholders of this company were willing to pay Tk.45.2 for every one taka of
reported earnings. It is the key for a companys judgment. Beximcos price earnings ratio is very

33

low than the industry average which is not a good sign for the companys performance. The
shareholders will not have any confidence to invest or reinvest in this company.

3b) DuPont Analysis

DuPont Analysis is an approach to evaluate a firms profitability and return on equity.
DuPont Analysis:
Net Profit Margin

Total Asset Turnover

Ratio

Return on Assets

2007

10.78%

0.44 times

4.71%

2008

37.36%

0.31 times

11.46%

2009

61.18%

0.31 times

19.19%

2010

36.13%

0.62 times

22.43%

2011

50.91%

0.39 times

19.88%

Return on Asset: Net Profit Margin x Total Asset Turnover

Net Income/ Total Asset = Net Income/ Sales x Sales/Total Asset
The ROA in 2011 decreases, due to the decrease in Total Asset Turnover. The net profit margin increased
in 2011. This shows that Sales decrease relative to the increase in total asset. It could be either that the

34

demand in the market seems to decrease and the sales are getting affected. The total asset is increasing
allot, we can see that loan also increases so maybe the company purchased asset using the loan.

Extended DuPont Analysis:

Net Profit Margin

Total Asset Turnover

Ratio

Equity Multiplier

Return on Euity

2007

10.78%

0.44 times

2.46

11.52%

2008

37.36%

0.31 times

1.52

17.18%

2009

61.18%

0.31 times

1.77

33.92%

2010

36.13%

0.62 times

1.71

38.43%

2011

50.91%

0.39 times

1.70

33.88%

Return on Equity: Net Profit Margin*Total Asset Turnover*Equity Multiplier

Net Income/ Total Common Equity= Net Income/Sales*Sales/Total Asset* Total Asset/Total Equity
The ROE decreased in 2011 after a increase in 2010. This is also due to the decrease in the total asset
turnover, the net profit margin is increasing and the equity multiplier has no significant change.This also
due to the decreasing sales in comparison with the increasing asset.

5 c) Insights on the Ratios:

Beximco is one of the leading countries in the country there sales profits assets equity and
liabilities have really high value. While calculating the ratio we saw there was an sudden
unrealistic humongous growth in Beximcos statements. So there is always a sudden change in
the trend of the ratios. The liquidity ratios are near and better than the industry average but in
comparison to their past performances there is a declined in the liquidity of the company. The
asset management ratios are in bad position compared to the industry average. It is better in 2011
but the company is not using its all assets properly to generate profits. The profitability ratios are
much better than the industry average. ROA and ROE is better than the industry average
showing the company is doing well in this sector. We can see in the trend that the most ratios
have a declining trend from 2010 which is a bad sign. The debt-management ratio is exactly the
35

industry average. The company had huge loans in 2010 which they have paid back in 2011 so the
debt management ratio is favorable. The stock-market ratio is not so satisfactory. The
shareholders are earning less than the industry average from the company. And other ratios are
also below the industry average and that shows that the shareholders have lack of confidence on
the company. If the company does not take necessary steps to handle this situation then they may
have to face some bad consequences.

4. Risk Analysis
To calculate the risk of Beximco Limited, we have collected last five years daily trading
information from DSE. Then we have taken the beginning and the ending market price of the
shares of each month of last five years. Using this information we have calculated total 60
monthly returns from 2008 to 2011. Then we have calculated the standard deviation and analyze
risk.
Beximco Limiteds Returns for all month from 2007 to 2011:
Months

2007

2008

2009

2010

2011

January

1.13%

1.93%

12.56%

1.28%

-5.69%

-17.28%

2.49%

-9.50%

11.56%

-20.30%

March

3.15%

6.48%

9.98%

0.16%

17.42%

April

-6.90%

-6.47%

25.52%

8.67%

-4.81%

May

-2.94%

9.87%

-14.40%

-22.13%

-40.67%

June

16.79%

72.71%

29.70%

-9.23%

3.39%

July

3.15%

69.02%

-4.23%

1.91%

17.11%

February

36

August

-7.19%

-21.67%

-10.10%

8.07%

-15.26%

September

-3.77%

94.05%

-3.99%

-5.69%

-4.36%

October

61.11%

-1.15%

15.21%

2.90%

-24.28%

November

3.45%

-41.12%

-9.23%

-1.20%

5.17%

December

-4.10%

36.73%

3.72%

-3.89%

-7.78%

STANDARD DEVIATION = 23.77%

So the risk of Beximco Limiteds stock is 23.77%. The standard deviation is a statistical measure
of variability of a set of observations. The smaller the standard deviation, the tighter will be the
probability distribution and there will be lower riskiness of stock. Here if a person invests in the
stock of Beximco limited 100 times, the risk of not getting the expected return 23.77 times.

5. Market Return
Market return measures the total return of a market on a whole. We have calculated the monthly
return of the market by using the DSE index in the same way we have calculated the monthly
return of Beximco Limited.
DSE Market Returns for all month from 2007 to 2011:
Month/Year

2007

2008

2009

2010

2011

JANUARY

14.02%

-3.38%

-5.63%

17.48%

-9.88%

FEBRUARY

-1.92%

1.42%

-3.41%

2.01%

-33.47%

MARCH

-1.85%

3.44%

-6.83%

0.27%

13.40%

APRIL

0.34%

1.56%

4.55%

0.92%

-6.14%

MAY

13.69%

2.13%

1.30%

8.46%

-3.89%

JUNE

7.09%

-6.46%

15.91%

0.12%

7.91%

JULY

8.84%

-8.85%

-5.06%

2.02%

4.91%

AUGUST

2.55%

3.76%

0.01%

3.44%

-2.44%

SEPTEMBER

1.26%

5.18%

4.53%

4.77%

-16.19%

37

OCTOBER

8.52%

-8.42%

7.72%

10.16%

-13.97%

NOVEMBER

4.75%

-6.70%

29.15%

8.23%

4.61%

DECEMBER

4.81%

11.06%

2.52%

-4.96%

0.40%

The average of these 60 monthly returns of the market is the Market Return (RM ) Market Return
Market Return per month = 1.85%
Market Return Annually (RM) = 1.85 x12
RM = 22.2%

5a) Beta Calculation:

Using the table in given in the appendix we have calculated the Beta. To find out the beta we
used the regression method. Our X axis input was the return of the monthly stock market and Y
axis was the monthly return of Beximco Limited for five years from 2007 to 2011. After running
the regression method we have calculated the beta which is
= 0.497
Regression analysis method results are shown below:
SUMMARY OUTPUT
Regression Statistics
Multiple R
0.178671
R Square
0.031923
Adjusted R
Square
0.015232
Standard
Error
0.235932
Observation
s
60
ANOVA
38

Df
Regression
Residual
Total

Intercept
X Variable 1

SS

MS
0.10646
3
0.05566
4

F
1.91260
6

P-value
0.36193
5
0.17197
5

0.106463

58
59

3.228504
3.334967

Coefficient
s

Standard
Error

0.028649

0.031176

t Stat
0.91893
6

0.497004

0.359374

1.38297

Significanc
eF
0.171975

-0.03376

Upper
95%
0.09105
4

-0.22236

1.21637

Lower 95%

We have cross checked the beta by using a scatter plot diagram which is given below:

39

Lower
95.0%
0.03376
0.22236

Upper
95.0%
0.09105
4
1.21637

Using both the methods Beximco Limiteds beta is 0.497.

Beta measures market risk, which is the extent to which the returns n a given stock move with
the stock market. The beta for market is 1.0. The Beta for Beximco Limited is 0.497%. It means
1% change in the market return will lead a 0..497% change in the Beximcos return.

Risk Free Rate of Return:

40

According to us, the safest investment in Bangladesh is the investment on 364 days Treasury bill
of Bangladesh Bank. The rate of return of that kind of bill is on an average 10.995%. We can
assume that the Bangladesh government will be able to pay the interest in all circumstances and
in this short period of time there is a very low possibility of changing the interest rate. So we
consider the risk free rate of return.
Risk Free Rate (Rf) = 10.995%

Required Rate of Return:

To calculate the required rate of return yearly (k e) we have to used the Capital Asset Pricing
Model. We need the market return (Rm), risk free rate of return (Rf) and the beta. We have
calculated the Km, Kb and , so we can use the CAPM equation.
The formula is:

CAPM, Ke = Rf + (Rm - Rf ) x
= 10.995 + (22.2 10.995) X 0.497
= 16.56%
So the investors yearly Required Rate of Return is 16.56%.

5b) Cost of Financing:

41

Cost of Financing is the price a company has to pay to obtain loan capital. We know that its
formula is:
Cost of Financing = Interest Rate x (1- Tax Rate)

And the Interest rate is simply obtained by dividing the Interest expense by EBIT (Earning
before Interest and Taxes). By doing so, we will get the before tax interest rate and cost of
financing of debt. And if we want to calculate the after tax interest rate and cost of financing of
debt, we just need to multiply the before tax interest rate and cost of financing of debt with (1Tax Rate)
If we refer to the Financial Report (Balance Sheet and Income Statement) for the year 2011
Interest Rate = (2959557424/8644756339) x100
= 11.10%

Tax Rate = (674985413/8007975587) x 100

= 8.43%
Cost of Financing = Interest Rate x (1- Tax Rate)
= 0.111(1-0.0843)
= 10.16%

5 c) Weighted Average Cost of Capital (WACC)

42

Weighted Average Cost of Capital (WACC) is a calculation of a firm's cost of capital in which
each category of capital is proportionately weighted. All capital sources - common stock,
preferred stock, bonds, retained earnings, and any other long-term debt - are included in a
WACC calculation. All else equal, the WACC of a firm increases as the beta and rate of return
on equity increases. An increase in WACC notes a decrease in valuation and a higher risk.
Cost of Equity:
The cost of equity is the Required Rate of Return (Ke ). The Required Rate of Return (Ke ) was
calculated using the Capital Asset Pricing Model (CAPM).
Therefore, Cost of Equity( Ke) = 16.56%
Market Value of Equity:
No. of common shares outstanding = 353520857
Market price per share = Tk. 113
Total market value of common equity = 353520857 X 113
= Tk. 39947856840
Retained earning = Tk. 16918967359
Total Equity = Common Stock Equity + Retained Earnings
= Tk. 39947856840 + Tk. 16918967359
= Tk.56866824190
Total Debt = Tk. 8644756339
Weight of Debt =
= 13.20%

Weight of Capital =
= 86.80 %
WACC = Wd Kd (1- Tax Rate)+ We x Ke
= 13.20 x 10.16% + 86.80 % x 16.56%
43

= 15.72%

6. Optimum Capital Structure

In finance, capital structure refers to the way a corporation finances its assets through some
combination of equity, debt, or hybrid securities. It is the perfect mix of debt and equity that
maximizes the share price.
Formula:
V*=EBIT (1- Tax)/WACC
Here,
EBIT-8,644,756,339
Tax- 8.43%

Weight of Debt

Cost of
Debt

Weight of
Equity

Cost of
Equity

WACC

V*

13.20%

10.16%

86.80%

16.56%

15.72%

50371636250

25%

10.16%

75%

16.56%

14.96%

52914461100

35%

10.16%

65%

16.56%

14.32%

55279353210

50%

10.16%

50%

16.56%

13.36%

59251522310

55%

10.16%

45%

16.56%

13.04%

60705547390

From this table, we can see there are 5 combinations of debt and equity including the actual
combination of Beximco Limited for the year 2011. Optimum Capital Structure means the
highest value generated from a mix of debt and equity. From all combinations most preferable
one is 55% debt and 45% equity because it gives the highest value among all. So the Optimum
Capital Structure is 55% debt and 45% equity.

44

7. Intrinsic Share Price

The intrinsic share price is the actual value of a share. The intrinsic value includes variables such
as, brand name, trademarks, and copyrights etc, which are often difficult to calculate and
sometimes not reflect in the market value of a share. Intrinsic share price reflects the price;
investors are willing to pay for buying the stock. If this value is more than the market value of a
share it means the companys shares are under-valued. And in the opposite case, if the intrinsic
share price is less then the market share price the companys shares are over-valued. That
implies, to calculate the intrinsic share price based on dividend discount model we need to find
out the required rate of return, growth rate and last paid dividend
.
Dividend per share:
For the year 2011, D0 = Tk.10/share
For the year 2012, D1 = D0 (1+g) = Tk.11.0033/share
For the year 2013, D2 = D1 (1+g) = Tk.12.11/share
For the year 2014, D3 = D2 (1+g) = Tk.12.59/share
Terminal value, TV2 = D3/ (Ke-g) = Tk.100.64

100.33%

2011

P0 , DO

100.33%

4.5%

2012

2013

D1

D2, TV2

Intrinsic value, Po = D1/ (1+i) + D2/ (1+i )2 + TV2/ (1+i)2

= Tk. 92.42
45

2014

D3

The constant growth rate was assumed to be 4.5%, which is below the required rate of return
(16.56%). The intrinsic stock price of Beximco Limited in 2011 was Tk. 92.42. Whereas, the
market value Beximco Limiteds Stock was Tk.113 in the year 2010. So, the intrinsic share price
is lower than the market price. So the stock price is over-valued. The investors are interested to
invest in this particular company for their huge reputation or for the dividend policy. This is a
good sign that people are attracted to the company but on the other hand because of the high
share price is there is a chance of sudden market fall also they investor to make profit might sell
the stocks.

46

8. Dividend Policy
There are three views:

1st view: One of the most argued by Modigliani and Miller. It states that the
dividend is the passive residual. People only care about the return (Capital gain
yield+ dividend gain yield). So, no matter what happens to the dividend as long as
the overall return is good the buyer will buy the share

2nd view: high dividend increases the share price.

People tend to value the

dividend, because it has more guaranteed income. For that higher dividend
attracts more buyers. As a result the share price very much depends on the
dividend.

3rd view: Low dividend increases the share price. People always try to
maximize income (after tax income). Though the tax rate on the dividend is
very high buyers expect to have lower dividend so that the overall return is
higher.

Dividend payment plans

Constant dollar payout ratio: In this policy the percentage of earnings paid
out in dividends is held constant. Although, the dividend-to-earnings ratio is
stable, the dollar amount of the dividend naturally fluctuates from year to
year as profits vary. Example:$0.5/share, $1.0 share
Stable dollar dividend per share payout: This dividend maintains relatively
stable dollar dividend overtime. An increase in the dollar usually does not
occur until management is convinced that the higher level can be
maintained in the future. Management also will not reduce the dollar
dividend until the evidence clearly indicates that a continuation of the
present dividend cannot be supported. Example: 10% cash,15% cash(on face
value)

47

Small regular dividend plus year end extra dividend payout: A corporation
following this policy pays a small regular dollar dividend plus a year end
extra dividend in prosperous years. The extra dividend is declared toward
the end of the fiscal year, when the companys profits for the period can be
estimated. If company has a very good profit year it (the company) follows
this policy. Example: $1, $1.5, $2.0

Dividend Policy of Beximco:

Beximcos dividend policy is highly based on stock dividend. Beximco gives
up to 25% of bonus stock dividend per share in 2011. So, we can say that
Beximco follows the 2nd view by giving the stockholders a certain return. For
every 100 shares Beximco gives 25 new shares. Even though the market
value of the share does not increase as the stock dividend is given but it
ensures the stock price not to decrease as the number of shares increase.

48

Notes:
1. We could not calculate g using the formula g = retention* ROE .Because our retention was
coming out to be more than 200%. Then Sir you gave us the permission to not to calculate using
this method.

49

APPENDIX

50

2.c) FORCASTED INCOME STATEMENT AND BALANCE SHEET

g calculation for sales:
net income:

2007

2008

2009

2010

2011

1721730460

2803557113

5327783716

18980964619

27438488152

g1 = (2803557113- 1721730460)/ 1721730460

= 62%
g2 = (5327783716-2803557113)/ 2803557113
= 90%
g3 = (18980964619-5327783716)/ 5327783716
= 256%
g4 = (27438488152-18980964619)/ 18980964619
=54.57%
Avg. growth rate, g= (62%+ 90%+256%+54.57%)/4
=115.64%

51

2) FV= PV(1+g)n
27438488152= 1721730460 (1+g) 4
g= 99.80%
so, g= (115.64+99.80)/2
= 114.39%

Dividend calculation:
2007:
No. Of common stock outstanding = no. of stock outstanding in 2007 + no. of stock outstanding
in 2007* dividend stock percentage
= 36204297 (1.15) = 41634941.55
Stock Dividend = no. Of stock outstanding in 2007* FV
= 41634941.55*10
= 416349415.5
2008:
Cash dividend = FV* Cash percentage* no. Of shares outstanding in 2007
= 10* 10%* 41634941.55
= 41634941.55
No. Of stocks outstanding = 41634941.55(1.50)
= 62452412.33
Stock dividend = 62452412.33*10 = 624524123.3
Total dividend = 41634941.55 + 624524123.3= 666159064.9

52

2009:
No of stocks outstanding = 62452412.33(1.60) = 99923859.73
Stock dividend= 99923859.73*10 = 999238597.3
2010:
No. Of stocks outstanding = 99923859.73(1.5) = 149885789.6
Stock dividend = 149885789.6 * 10 = 1498857896
2011:
No. Of stocks outstanding = 149885789.6(1.25) = 187357237
Stock dividend = 187357237 *10 = 1873572370

g calculation for dividend forecasting:

1) dividend:
2007
41634941.50

2008
666159064.90

2009
999238597.30

2010
1498857896.00

2011
1873572370.00

g = (666159064.90-41634941.50)/ 41634941.50 = 1500%

g = (999238597.30 -666159064.90)/ 666159064.90 = 49.99%
g = (1498857896.00-999238597.30)/ 999238597.30 = 50%
g = (1873572370.00-1498857896.00)/ 1498857896.00 = 25%
avg. g = (49.99+50+25)/3= 41.66%
[note: as the dividend return of 2008 was very high we are excluding the return taking it
as a exception]
2) FV =PV (1+g) n
1873572370.00 = 41634941.50 (1+g )4

53

g = 159.002%
3) Sustainable growth rate :
Note: g is not possible to be counted as retention ratio was not possible to be counted
from the annual reports of Bangladesh Export and Import company.

so, g= (41.66+ 159.002)/2 = 100.33%

Dividend:
2012: 1873572370 (1+1.033) = 3753327529
2013: 3753327529(1+1.033) = 7519041039
Retained earnings calculation:
RE= beginning retained earnings+ net income- dividends
2012: 16918967359 + 96133200624.34 3753327529 =109298840454.34
2013: 109298840454.34+206099968818.52-7519041039 = 307879768233.85
EPS calculation:
EPS = net income/ no. Of stocks outstanding
2012: 96133200624.34/ (109298840454.34/10) = 8.79
2013: 206099968818.52/ (307879768233.85/10) = 6.69
[ note: as the Face value of stocks remains same from 2007 we are assuming it will be constant]

FORECASTED INCOME STATEMENT:

2012
Revenue(turnover) from net
Sales
Cost of Goods Sold

Gross Operating Profit

29339932714(1+1.1439)

2013
62901881746(1+1.1439)

16260877280/29339932714
*100= 55.42%

34860222863/62901881746*1
00= 55.42%

62901881746* 55.42%

134855344274.27* 55.42%

62901881746-34860222863

134855344274.27-

54

74736831796.80
Operating Expenses

Administrative expenses

Selling and Distribution

Expenses

Exchange loss

Operating Profit
Financial Expenses
Net Profit Before Cont. to
WPWF
Contribution to Workers'
Profit/Welfare Fund

Net Profit Before Income

tax
Income tax Expenses

6270773509+350623895.1
+40456603.28

2924937501+163544892.5+
18870564.52
1365536627/29339932714
*100= 4.65%

2924937501/62901881746*10
0=4.65%

62901881746* 4.65%

134855344274.27* 4.65%

75169915/29339932714 *100=
0.25%

163544892.5/62901881746*10
0= 0.25%

62901881746* 0.25%

134855344274.27* 0.25%

10120204/29339932714*100=
0.03%

18870564.52/62901881746*10
0= 0.03%

62901881746* 0.03%

134855344274.27* 0.03%

97762104609
-3107352958
-3219854322

209592176071.08
-6661854007
-3219854322

94654751651
-3219854322
400398779/29339932714*100
= 1.36%

202930322063.93
-3219854322
855465591.7/62901881746*10
0= 1.36%

62901881746* 1.36%

134855344274.27* 1.36%

87754415223-855465591.7

674985413/8007975587
*100=8.43%
88609880815* 8.43%
Net Profit after Tax

199710467741.93
-1834032682
16087354170/19787643505
9.80
*100
=8.13%
197876435059.80* 8.13%
197876435059.80
-16087354170

88609880815-7203983310
Non-Controlling (minority)
Interest in Income

84384072/29339932714*100=
0.03%
55

181157419.4/62901881746*10
0= 0.03%

Net Profit after NonControlling(minority)

Interest
Other Comprehensive
Income
Revaluation Surplus on
Property,Plant &
Equipments

Fair Value Gain on

Investment in Shares

Total Comprehensive
Income after minority
interest

62901881746* 0.03%

134855344274.27* 0.03%

7248606102/29339932714*10
0= 0.29%

79652907607.00/62901881746
*100= 0.29%

62901881746* 0.29%

134855344274.27* 0.29%

7601395496/29339932714*10
0
= 25.91%

16297877560/
62901881746*100= 25.91%

62901881746* 25.91%

134855344274.27* 25.91%

86202955/29339932714*100=
0.29%

182415457.1/62901881746*10
0= 0.29%

62901881746* 0.29%

134855344274.27* 0.29%

181400697497.93+
79652907607.00+1629787756
34941019701
0+
182415457.1

EPS

8.79

+391080498.4
6.69

FORECASTED BALANCE SHEET:

56

2012
Non-current Assets

property,plant and equipment

Investment in Shares

2013

56884253318.07+5180683914.75 121954150688.61+11106
868245
+
+56290261.97+81789174
26256011.00+817891743

26533072120/29339932714
*100= 90.43%

56884253318.07/ 62901881746*100=
90.43%

62901881746* 90.43%

134855344274.27* 90.43%

2416476475/29339932714
*100= 8.24%

5180683914.75/ 62901881746*100=
8.24%

62901881746* 8.24%
Deffered Assets

12246845/29339932714 *100=
0.041%

134855344274.27* 8.24%
26256011.00/ 62901881746*100=
0.041%

62901881746* 0.041%
Long-term Loan
Current Assets

134855344274.27* 0.041%

817891743

817891743

26599588863.04+1025
03852198.83
+78097613906.41+11
91406236.36
97202510007.29

Inventories

5787165141/29339932714
*100= 19.72%

12407103345.79/
62901881746*100=19.72%

62901881746* 19.72%
Trade and Other Receivables

22301349217/29339932714
*100= 76.01%

134855344274.27*19.72%
47811862586.33/ 62901881746*100=
76.01%

62901881746* 76.01%
Advances, Deposits and PrePayments

Cash and Cash Equivalents

134855344274.27* 76.01%

16991382503/29339932714
*100= 57.91%

36427824948.18/ 62901881746*100=
57.91%

62901881746* 57.91%

134855344274.27* 57.91%

259209444/29339932714
*100= 0.88%

555719126.99/ 62901881746*100=
0.88%

62901881746* 0.88%
Total Assets

134855344274.27* 0.88%

63844671351.63+97202510007.29
57

136876590910.77+208392461204.63

Equity and Liabilities

Shareholder's Equity

136459835212.34

335040762991.85

Liquidity Ratio
Ratio
Current ratio

Quick ratio

Working
capital

Formula

Aramit
606243015/
332352857

Current
assets/current
liabilities
(In times)
(Current
(606243015assets164804751)/
inventories)/c 332352857
urrent liability
(in times)
606243015Current
332352857
assets- current
liabilities

Berger
2264647/
1333642

GQ ball pen
482070603/2
87022650

BSC
2131947699/
631803574

(22646471346988)/
1333642

(482070603144132670)/
287022650

(2131947699375469202)/
631803574

22646471333642

482070603287022650

2131947699631803574

58

(In taka)

Ratios

Current
ratio

Quick
ratio/acid

Working
capital

Formulas

Current
assets/curre
nt liabilities
(In times)
(Current
assetsinventories)
/current
liability
(in times)
Current
assetscurrent
liabilities
(In taka)

2007

2008

2009

2010

2011

187996830
3/
145352274
3

5,787,165,1 11,526,373, 226599924 453391063

41/2967396 536/483583 65/1038733 05/2445844
719
6508
3054
7194

(18799683
03888067732
)/14535227
43

(57871651
41299923342
7)/2967396
719

(11526373
536344084369
6)/4835836
508

(22659992
465440696482
1)/1038733
3054

(453391063
05578716514
1)/2445844
7194

187996830
3145352274
3

578716514
1296739671
9

115263735
36483583650
8

226599924
65103873330
54

453391063
05244584471
94

Asset Management Ratio

59

Ratios

Formula
s

Asset
Manage
ment
Ratio:
Inventory
turn-over
ratio

Cost of
goods
sold/
inventory

Aramit
Limited
Taka
in000

Berger
Paints
Take in
000

GQ Ball
Pen
Take in
000

365
365/2.74
days/inve
ntory
turnover
ratio
Total
sales/total 585,578,0
asset
assets
70/
turn-over
853,383,8
ratio
60
Fixed
Sales/
585,578,0
asset ratio Fixed
70/
assets
247,140,8
45

365/3.09

Day's
sales
outstandi
ng

1,093,150
/
(585,578,
070/365)

472,468/(
6,321,274
/
365)

268,538,7
50/
(452,092,
313/
365)

103,651/
(4,167,03
9/
365)

Average
payment
period

Take in
000

Beximco
Limited
Take in
000

452,092,3 4,167,039 194,204,7 2,397,015 16,260,87

13/
/
31/
,344/375, 7,280/5,7
164,804,7 1,346,988 144,132,6 469,202
87,165,14
51
70
1

Day's in
inventory

Accounts
receivabl
e/
(sales/365
)
Accounts
payable/
(cost of
goods
sold/365)

BSE

365/1.35

365/6.38

6,321,274 218,718,9 2,512,712

/
33/
,635/3,45
3,424,689 944,139,4 7,525,846
36
6,321,274 218,718,9 2,512,712
/
33/
,635/1,32
1,160,042 462,068,8 5,578,
33
147
15,802,67
4/
(218,718,
933/365)

211,776,6
09/
(2,512,71
2,635/365
)
1,276,651 203,299,8
/
08/
(194,204, (2,397,01
731/
5,344/365
365)
)

Profitability Ratio:

60

365/2.81

29,339,93
2,714/75,
118,793,4
88
29,339,93
2,714/29,
779,687,1
83

Industry
Average
Taka
in000

(2.74+1.3
5+6.38+3.
09+2.81)/
5
(133+270
+58+
118+130)
/5

(0.69+0.2
3+
0.73+1.85
+0.39)/5
(2.37+0.4
7+
1.80+5.40
+
0.99)/5
22,301,34 (1+26+31
9,217/
+28+
(29,339,9 2770/5
32,714/36
5)
8,557,615 (217+3+3
,555/
1+
(16,260,8 9+192)/5
77,280/36
5)

Ratios

Formulas

Profitabilit
y Ratio:
Gross profit
margin

(Gross
Profit/
Sales)*100

Operating
profit
margin

(Operating
profit/Sales
)*100

Net profit
margin

(Net profit/
Sales)
*100

ROA

(Net
profit/Total
asset)*100

ROE

(Net
profit/Total
equity)*10
0

Operating
Return on
Asset

(EBIT/Tota
l
Asset)*100
%

2007

2008

2009

2010

2011

Taka
in000

Taka
in000

Taka
in000

Taka
in000

Taka
in000

577,232,18
6
/1,721,730,
460
468,916,54
4/
1,721,730,4
60
185,635,97
8/
1,721,730,4
60
185,635,97
8/
3,953,800,6
68
-10,000,31
2
185,635,97
8/
1,611,487,8
48

1,450,086,5
55
/2,803,557,
113
1,304,479,6
55/
2,803,557,1
13
1,047,357,4
52/
2,803,557,1
13
1,047,357,4
52/
10,657,285,
210
-1,518,536,
258
1,047,357,4
52/
6,097,109,6
99

3,969,528,1
88 /
5,327,783,7
16
3,775,143,2
43/
5,327,783,7
16
3,259,800,6
17/5,327,78
3,716

8,265,442,7
29 /
18,980,964,
619
8,012,370,4
76/
18,980,964,
619
6,857,572,2
57/
18,980,964,
619
3,259,800,6 6,857,572,2
17 /
57 /
16,987,753, 30,569,775,
707
387

13,079,055,
434/29,339,
932,714
11,628,228,
688/29,339,
932,714
14,936,204,
553 /
29,339,932,
714
14,936,204,
553 /
75,118,793,
488

6,857,572,2 14,936,204,
3,259,800,6 57/
553/44,079,
17/
17,843,954, 962,117
9,608,872,5 106
06
468,916,54 1,304,479,6 3,775,143,2 8,012,370,4 11,628,228,
4/
55/
43/
76/
688/
3,953,800,6 10,657,285, 16,987,753, 30,569,775, 75,118,793,
68210707
387
488
10,000,312 1,518,536,2
58

Debt Management Ratios

61

ratio

2007

2008

2009

2010

2011

DebtAsset
ratio

1020335581+
11029742+
2967396719/
10657285210
468916544/
225242845

1410929880+
12654931+
4835836508
/16987753707
1304479455/
149073846

4835836508+
1410929880+
12654931/
16987753707
3775143243/
327699387

103887333054+
1078512573+
13892058
/30569777387
8012730476/
633592074

(5220136740+
9965449+
24458447194
/75118793488)
(4242975262/
2913249384)

Ratio

Beximco

(Total
debt/
total
asset)%
Time
EBIT/
Interest Interest
Ratio

DebtAsset
ratio

Time
Interest
Ratio

(Total
(5220136
debt/ total 740+9965
asset)%
449+
24458447
194
/
75118793
488)
EBIT/
(4242975
Interest
262/2913
249384)

Aramit

GQ Ball
pen

Berger

BSC

Industry
average

(2785708
6+
32235285
7)
/
85338386
0

28702265
0/462068
833+4820
70603

(1333642 16726306 0.39+0.41

+102821/ 72/34575 +0.3+0.42
1160042+ 25846
+.48/5%
2264647)

85773648 (7139340 925697+4 1.46+147

/
+3290794 3661/436 45890168 2.10+3.17
58266
)/329079 61
/1845013 +22.10-.2
4
86
5+299.74/
5

Market Ratios:

62

Ratios
Market
Ratios
Earnings
per Share

Market/
Book Ratio
Price
Earning
Ratio

Ratios
Market
Ratios
Earnings per
Share

Market/ Book
Ratio
Price Earning
Ratio

Formulas

2007

Net Profit /
Total
Number of
Shares
Outstandin
g
Market
Price/ Book
Value per
Share
Market
Price/Earni
ngs Per
Share

185635983/ 108986233 334598848 698419597 733299017

362042970 3/54884941 3/94237251 1/16547958 4/35352085
0
0
00
70

37.4/4.45

2008

2009

2010

2011

184.4/11.12 309.3/10.19 311.5/10.78 113/12.4

184.4/1.91

309.3/3.46

311.5/1.94

113/2.5

37.4/0.51

Aramit
Limited

Berger
Paints

GQ Ball Pen

BSC

BexImco
Limited

85540569/60
000000

53523980/53
913600

53523980/53
913600

18360120/

7332990174/3
535208570

277.2/8.39

550/8.75

169.6/12.19

554.5/8.92

113/12.4

550/3.11

169.6/0.99

554.5/.918

113/2.5

277.2/14.26

63

5. Beximco Return (2007-2011)

2007

2008

2009

2010

2011

January

(35.80-35.40)/
35.40*100

(36.9-36.2)
/36.2*100

(206.1-183.1)/
183.1*100

(324- 319.9)
/319.9*100

February

(29.20-35.30)/
35.30*100

(37-36.10)/
36.10*100

(183.8-203.1)/
203.1*100

(376.4-337.5) /
337.5*100

March

(29.50-28.60)/
28.60*100

(39.4-36.90)
/36.90*100

(203.8-185.3)/
185.3*100

(380.1-379.5) /
379.5*100

April

(27-29)/
29*100

(39-41.70)
/41.70*100

(260.2-207.3)/
207.3*100

(414.4-381.6) /
381.6*100

May

(26.40-27.20)/
27.20*100

(43.40-39.50)
/39.50*100

(237.8-277.8)/
277.8*100

(323.7-417.5) /
417.5*100

June

(30.60-26.20)/
26.20*100

(84.80-49.10)
/49.10*100

(315.3-243.1)/
243.1*100

(398.8-329.2) /
329.2*100

July

(32.70-31.70)/
31.70*100

(139.1-82.3)
/82.3*100

(305.5-319)/
319*100

(304.5-298.8) /
298.8*100

August

(27.10-29.20)/
29.20*100

(108.8-138.9)
/138.9*100

(274-304.8)/
304.8*100

(336-310.9)
/310.9*100

September

(25.50-26.50)/
26.50*100

(215.2-110.9)
/110.9*100

(274.4-285.8)/
285.8*100

(315.2-334.2) /
334.2*100

October

(40.60-25.20)/
25.20*100

(316.7-274.9)/
274.9*100

(323-313.9)
/313.9*100

November

(42-40.60)/
40.60*100

(231.50234.20)
/234.20*100
(128.5-218.2)
/218.2*100

(297.9-328.2)/
328.2*100

(322.1-324.8)
/324.8*100

(37.40-39)/
39*100

(185.4-135.6)
/135.60*100

(309.3-298.2)/
298.2*100

(311.5-324.1) /
324.1*100

(301.50319.70)/319.70
*100
(234.40294.10)/294.10
*100
(299.30254.90)/254.90
*100
(283.10297.40)/297.40
*100
(159.90266.80)/266.80
*100
(159.90154.80)/154.80
*100
(195.10166.60)/166.60
*100
(156.60184.80)/184.80
*100
(153.50160.50)/160.50
*100
(116.00153.20)/153.20
*100
(124.10118.00)/118.00
*100
(113.00122.40)/122.40
*100

December

64

Market Return(2007-2012)
Month

2007

2008

2009

2010

2011

January

{(1805.121583.08)/
1583.08}*100

{(2907.173008.91)
/3008.91}*100

(2,649.492,807.61)/2,8
07.61)*100

((5367.114568.4)/4568
.4)*100

((8302.597484.23)/7484.
23)*100

{(1791.541826.58)/
1826.58}*100

{( 2931.382890.25)
/2890.25}*100

((2,570.962,661.6)/2,66
1.69 )*100

((5560.565451.15)/545
1.15)*100

((7820.285203.08)/5203.
08)*100

((5582.335567.4)/5567
.4)*100

((6352.15601.6)/5601.6
)*100

((5654.885594.32)/559
4.32)*100

((6050.856447.01)/6447.
01)*100

February

March

{(1760.881794.02)/
1794.02}*100

April

{(1743.331737.36)/
1737.36}*100

May

{(2003.581762.36)/
1762.36}*100

{(3167.993101.94)
/3101.94}*100

((2,572.182,539.17)/2,5
39.17)*100

((6107.815631.3)/5631
.3)*100

((5991.385758.26)/5758.
26)*100

June

{(2149.322007.05)/
2007.05}*100

{(3000.503207.89)
/3207.89}*100

((3,010.262,597)/2,597)
*100

((6153.686152.39)/615
2.39)*100

((6117.235668.68)/5668.
68)*100

July

{(2384.182190.46)/
2190.46}*100

((6342.766217.08)/621
7.08)*100

((6459.626157.52)/6157.
52)*100

August

{(2455.092394.11)/
2394.11}*100

((6657.976436.77)/643
6.77)*100

((62126367.6)/6367.6
)*100

September

{(2548.492516.72)
/2516.72}*100

((7097.386774.87)/677
4.87)*100

((5910.746193.08)/6193.
08)*100

{(3016.492916.20)
/2916.20}*100
{(3072.853025.57)
/3025.57}*100

{(2761.053029.24)
/3029.24}*100
{(2791.212689.94
/2689.94}*100
{(2966.822820.79)
/2820.79}*100

65

((2,446.922,626.27)/2,6
26.27 )*100
((2,554.362,443.2)/2,44
3.25)*100

((2,914.533,069.71)/3,0
69.71 )*100
((2,941.282,941.02)/2,9
41.02)*100

((3,083.892,950.12)/2,9
50.12 )*100

October

{(2850.812627.02)/
2627.02}*100

November

December

{(2971.112836.32)/
2836.32}*100

{(3017.212878.74)/
2878.74}*100

{(2748.603001.37)/
3001.37}*100

{(2468.922684.69)/
2684.69}*100

{(2795.342517.05
/2517.05}*100

For Beta Calculation:

Market
Return y axis
14.02%
-1.92%
-1.85%
0.34%
13.69%
7.09%
8.84%
2.55%
1.26%
8.52%
4.75%
4.81%
-3.38%
1.42%
3.44%
1.56%
2.13%
-6.46%
-8.85%
3.76%

Beximco Return
x axis
1.13%
-17.28%
3.15%
-6.90%
-2.94%
16.79%
3.15%
-7.19%
-3.77%
61.11%
3.45%
-4.10%
1.93%
2.49%
6.48%
-6.47%
9.87%
72.71%
69.02%
-21.67%
66

((3,364.263,123.24)/3,1
23.24)*100
((4,380.953,392.02)/
3,392.02)*10
0
((4,535.534,424.02)/4,4
24.02 )*100

((7957.127223.49)/722
3.49)*100

((5036.55901.94)/5901.
94)*100

((8602.447947.8)/7947
.8)*100

((5268.555205.17)/5205.
17)*100

((8290.418723.18)/872
3.18)*100

((5257.615236.76)/5236.
76)*100

5.18%
-8.42%
-8.03%
11.06%
-5.63%
-3.41%
-6.83%
4.55%
1.30%
15.91%
-5.06%
0.01%
4.53%
7.72%
29.15%
2.52%
17.48%
2.01%
0.27%
1.08%
8.46%
0.02%
2.02%
3.44%
4.77%
10.16%
8.24%
-4.96%
-9.88%
-28.53%
13.40%
-6.14%
-3.89%
7.91%
4.91%
-2.44%
-4.57%
-14.66%
1.22%
0.40%

94.05%
-1.15%
-41.12%
36.73%
12.56%
-9.50%
9.98%
25.52%
-14.40%
29.70%
-4.23%
-10.10%
-3.99%
15.21%
-9.23%
3.72%
1.28%
11.56%
0.16%
8.67%
-22.13%
-9.23%
1.91%
8.07%
-5.69%
2.90%
-1.20%
-3.89%
-5.69%
-20.30%
17.42%
-4.81%
-40.67%
3.39%
17.11%
-15.26%
-4.36%
-24.28%
5.17%
-7.78%
67

6. Optimum Capital Structure Calculation:

Weight of Debt

Weight of equity

V*=EBIT(1-Tax)/WACC

13.20%

86.80% 7,916,003,380/0.1572

25%

75% 7,916,003,380/0.1496

35%

65% 7,916,003,380/0.1432

50%

50% 7,916,003,380/0.1336

55%

45% 7,916,003,380/0.1304

7. Intrinsic Value calculation:

D0 = total dividend/ no. Of shares outstanding
= 1873572370/ 187357237 = 10 tk/ share
D1 = D0 (1+g) = 10 (1+ 1.0033)
D2 = D1 (1+g) = 11.0033(1+ 1.0033)
D3 = D2 (1+g) = 12.1 (1+ 1.0033)
Terminal value, TV2 = D3/ Ke -g = 12.59 (0.1656 0.0405)
Intrinsic value, Po = D1/ (1+i) + D2/ (1+i )2 + TV2/ (1+i)2
= 11.0033/ 1.1656 + 12.11/(1.1656)2+ 100.64/ (1.1656)2

68