BALANCE SHEET

AS AT JUNE 30, 2010

2010 2010
ASSETS in 000 EQUITY AND LIABILITIES in 000
NON CURRENT ASSETS CAPITAL AND RESERVES
Property, plant and 756,339 Authorised Capital
Investments - Available for - 10,000,000 ordinary shares of 10 100,000
Long term deposits 517 each
Issued, subscribed and paid up
Long term loans 270 capital
8,391,094 ordinary shares of 10 83,911
757,126 each
General reserves 375,500
CURRENT ASSETS Unappropriated profit 224,743
Stores, spares and loose 22,413 684,154
Stock-in-trade 531,597
Trade debts 100,396 SURPLUS ON REVALUATION OF
PROPERTY, PLANT AND EQUIPMENT
Loans and advances 2,350 - leasehold land 173,786
Deposits and prepayments 5,928 NON CURRENT LIABILITIES
Investments 26,224 Deferred liabilities 111,246
Accrued mark-up / interest 195 CURRENT LIABILITIES
Other receivables - Trade and other payables 368,911
Sales tax - net 31,050 Accrued mark-up / interest 1,245
Advance tax - net 6,792 Short term borrowing - secured 174,598
Cash and bank balances 29,869 Provision for taxation - net -
756,814 544,754

1,513,94 1,513,94
0 0

OTHER INFORMATIONS

Depereciation charge 54,226,000

Common share outstanding 83,911,000

INVESTOR INFORMATION

Earning Per Share 26.52

Market Price Per Share 185.13
Book Value Per Share 81.53
Cash flow per share 3
 PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED JUNE 30, 2010
2010
in 000

Sales 4,024,422
Cost of sales -3,433,222
Gross profit 591,200
Distribution cost -128,861
Administrative expenses -80,548
Other operating income 5,258
Other operating expenses -25,903
Profit from operations 361,146
Finance cost -19,857
Profit before tax 341,289
Taxation -118,755
Profit after tax 222,534
Other comprehensive income -
Total comprehensive income for the 222,534
year
Basic & Diluted earnings per share 26.52
 CASH FLOW STATEMENT
FOR THE YEAR ENDED JUNE 30, 2010

2010
in 000

CASH FLOWS FROM OPERATING ACTIVITIES 190,487

CASH FLOWS FROM INVESTING ACTIVITIES 406,363
Fixed capital expenditure -177,831
Investments acquired -210,700
Proceeds from disposal of property, plant and 2,867
Proceeds from disposal of investments 194,227
Cash used in investing activities -191,437
Net cash flow before financing activities -950
FINANCING ACTIVITIES
Increase / (decrease) in short term borrowing 70,982
Dividend paid -69,055
Net cash generated / (used) from financing activities 1,927
Increase/(decrease) / in cash & cash equivalent 977
Cash and cash equivalent as at the beginning of the 28,892
Cash and cash equivalent as at June 30 29,869
 2010
in "000"

Liquidity Ratios
Current Ratio:
Current Assets 756,814
Current Liabilities 544,754
1.39
Quick Ratio: EBIT
Current Assets - Inventories 225,217
Current Liabilities 544,754
0.41
Asset Management Ratio

Inventory Turn over Ratio:

Sales 4,024,422
inventories 531,597
7.57
Days Sales Outstanding:
Account Receivable 100,396
Annual sales/365 11025.81
9.11

Fixed Assets Turn over Ratio:

Sales 4,024,422
Net fixed assets 757,126
5.32
Total Assets Turn over Ratio:
Sales 4,024,422
Total Assets 1,513,940
2.66

Debt Management Ratio

Debt Ratio:
Total Debt 100,396
Total Assets 1,513,940
6.6%
Time Interest Earned Ratio:
EBIT 341,289
Interest Charges 19,857
17.19

DU Pont Equation
Net Income 222,534
Equity 684,154
0.33
 2010
in "000"

Profitability Ratios
Profitability Margin on Sales: Net operating profit after tax (NOPAT)
Net income 222,534 NOPAT = EBIT ( 1 - tax)
Sales 4,024,422
% 5.5% Net Cash Flow (NCF)
Basic Earning Power Ratio:
EBIT 361,146 Net income + Depreciation
Total Assets 1,513,940
% 23.9% Operating Cash Flow (OCF)
Return on Total Assets:
Net income 222,534 NOPAT+ depreciation
Total Assets 756,814
% 29.4% Net operating working capital(NOWC)
Return on Common Equity:
Net income 222,534 Current assets-Current Laibilities
Common Equity 83,911
% 265.2% Operating Capital (OC)
Market Value Ratios
Price Earning Ratio: Net operating working capital+ Net fixed assets
Price Per Share 185.13
Earnings Per Share 26.52 Free Cash Flow (FCF)
(Times) 6.98
Price/Cash flow Ratio: NOPAT- ( Change in operating working Capital)
Price Per Share 185.13
Cash flow per share 3.30 Market Value Added (MVA)
56.13
Market Book Ratio: ( Market price per share* # of shares)- B.V of Equ
Market Price Per Share 185.13
Book Value Per Share 81.53
(Times) 2.27

fit after tax (NOPAT)
ow (OCF)
rking capital(NOWC)
ent Laibilities
ng capital+ Net fixed assets
n operating working Capital)
ed (MVA)
hare* # of shares)- B.V of Equity
2010
in 000
Liquidity Ratios
Current Ratio
221,838 Quick Ratio
Asset Management Ratios
Inventory Turnover Ratio
Days Sales Outstanding
276,760 Fixed Assets Turnover Ratio
Total Assets Turnover Ratio
Debt Management Ratios
Debt Ratio
276,760 Times-Interest-Earned Ratio
Profitability Ratios
Profit Margin on Sales
212,060 Basic Earning Power Ratio
Return on Total Assets
Return on Common Equity
Market Value Ratios
969,186 Price/Earning Ratio
Price/Cashflow Ratio
Market/Book Ratio
9,778 Other Calculations
Net Operating profit After Tax - NOPAT
Net Operating Working Capital - NOWC
Operating Cash Flow - OCF
869,247,277 Net Cash Flow - NCF
Market Value Added - MVA
 Abbott

1.39
0.41

7.57
9.11
5.32
2.66

6.6%
17.19

5.5%
23.9%
29.4%
265.2%

6.98
56.13
2.27

221837.9
212060.0
276760.0
276760.0
869247276.8
Part I Dividend Growth Model

= Do(1+g)/Ks-g

Po 185.13

working
2006 2007 2008 2009 2010
total dividend distributed 11290000 15669000 36046000 51671000 69055000
total number of shares 52874000 60805000 69926000 69926000 83911000
dividend per share 0.21 0.26 0.52 0.74 0.82

Year sales difference growth in sales net profit difference growth in net profit
2006 1209033000 41323000
2007 1585648000 376615000 31.15% 87510000 46187000 111.77%
2008 2628820000 1043172000 65.79% 106797000 19287000 22.04%
2009 3156807000 527987000 20.08% 177678000 70881000 66.37%
2010 4024422000 867615000 27.48% 222534000 44856000 25.25%
Average Growth (g) 36.13% Average Growth 56.36%

Year EPS difference growth in EPS

2006 7.82
2007 14.39 6.57 84.02%
2008 15.27 0.88 6.12%
2009 25.41 10.14 66.40%
2010 26.52 1.11 4.37%
Average Growth 40.23%

I have selected the growth with repsect to sales

Overall Po with respect to average growth and dividend as per 2010.

Ks= 36.73%

The corporate Value Model

Part II Vcompany FCF/(1+WACC)
164729173.47

working for free cash flow

EBIT NOPAT Current Assets Current Liabilities Net Fixed Assets NOWC Free Cash flow
2003 818000000 531700000
2004 1080000000 702000000
2005 1366000000 887900000
2006 1440000000 936000000
2007 1744197000 1133728050 3129129000 881681000 1516821000 3764269000
2008 544822000 354134300 3421308000 1346771000 1560835000 3635372000 225237300

Dividend Yield Capital Gain Yield

Part III Dividend Yield = D1/P0 0.61% Capital Gain Yield = (P1 – P0) / P0 36.13%

Working
D1 = D0 (1+g)1 1.12 P1 = P0 (1+g) 252

Total Return (Ks) = Dividend yield+Capital gain yield

0.72%+10.57%
36.73%
WACC Book Value WACC Market Value
WACC = wdkd(1-T) + wpkp + wcks WACC = wdkd(1-T) + wpkp + wcks
0+ 36.73188255498390% 0+ 36.73188255498390%
WACC= 36.73% WACC= 36.73%

working Book Value Working Market Value

2010 2010
Kd Kd
Kp Kp
Ks 36.73% Ks 36.73%
% age of total % age of total
long term debt Wd 0 0.00% long term debt Wd 0 0.00%
commmon stock Wc 83911000 100.00% Common Stock (market Value) W1 1553401276.75 100.00%
total 83911000 1553401276.75

W1
No of Shares 8391094
Po 185.13
market value of Wc ###
Cost 50,000,000
Shipping 1,000,000
Installation 3,000,000
Total cost 54,000,000
Life (Years) 10
Market Value 1,000,000
Annual sales 50,000
Price / Unit 2,000
Cost / Unit 1,200
NOWC 29.4%
Tax 39%
WACC 36.73%
Growth / Year 40.23%

0 1
Units sold 50,000
Unit price 2,000
Unit cost (1,200)
sales 100,000,000
costs (60,000,000)
NOWC (29,400,000) (11,827,620)
Depreciation (5,400,000)
EBIT 22,772,380
Tax @ 39% (8,881,228)
NOPAT 13,891,152
NOCF 19,291,152
Salvage
Capital G / L
Tax on salvage
Net CF -
Terminal CF (83,400,000) 19,291,152
Incremental CF (64,108,848)
 NPV 115,799,302
IRR 55%
MIRR 47%

So on the basis of these values of NPV and IRR the project should be accepte
 5,400,000
(straight line)

2 3 4 5
50,000 50,000 50,000 50,000
2,805 3,933 5,515 7,734
(1,683) (2,360) (3,309) (4,640)
140,230,000 196,644,529 275,754,623 386,690,708
(84,138,000) (117,986,717) ### ###
(16,585,872) (23,258,368) (32,615,209) (45,736,308)
(5,400,000) (5,400,000) (5,400,000) (5,400,000)
34,106,128 49,999,444 72,286,640 103,539,976
(13,301,390) (19,499,783) (28,191,790) (40,380,591)
20,804,738 30,499,661 44,094,851 63,159,385
26,204,738 35,899,661 49,494,851 68,559,385

-
26,204,738 35,899,661 49,494,851 68,559,385
(37,904,110)
R the project should be accepted as NPV is positive and the IRR is also high.
 6 7 8 9
50,000 50,000 50,000 50,000
10,845 15,208 21,326 29,906
(6,507) (9,125) (12,796) (17,944)
542,256,380 760,406,121 ### ###
### ### (639,790,502) (897,178,221)
(64,136,024) (89,937,946) (126,119,982) (176,858,051)
(5,400,000) (5,400,000) (5,400,000) (5,400,000)
147,366,528 208,824,502 295,007,019 415,860,763
(57,472,946) (81,441,556) (115,052,737) (162,185,698)
89,893,582 127,382,946 179,954,282 253,675,065
95,293,582 132,782,946 185,354,282 259,075,065

95,293,582 ### ### ###

 10
50,000
41,937
(25,162)
2,096,855,033
###
###
(5,400,000)
1,449,817,393
(565,428,783)
884,388,610
889,788,610
1,000,000
1,000,000
-390000
610,000
890,398,610