Event Date: N/A
JHAMB & ASSOCIATES, a company of secretaries and registered valuers, prepared a Valuation Report of Equity Shares of Ecosure Pulpmolding Technologies Limited ("EPTL") as of August 23, 2024, for The Board of Directors of EPTL. Hitesh Jhamb, a registered valuer with IBBI Registration Number IBBI/RV/11/2019/12355, was requested to estimate the fair value of equity shares of EPTL.
Executive Summary:
EPTL, incorporated on November 21, 2019, is a public company limited by shares, engaged in manufacturing of pulp molding machineries. As of the valuation date, the authorised share capital of EPTL was INR 5,00,00,000, and the issued, subscribed, and paid-up share capital was INR 3,05,00,000. The management seeks to estimate the fair value of equity shares for internal assessment and to comply with the Companies Act, 2013. Jhamb considered three valuation approaches: cost, income, and market, ultimately using the income approach for the valuation.
Valuation Approach & Rationale
The valuation considered projected financial information from August 21, 2024, to March 31, 2029. The Free Cash Flow to Firm (FCFF) methodology under the Discounted Cash Flow (DCF) method was used. The cost approach (Net Asset Value, Breakup Value) was not considered because the asset base does not dominate earnings capability. The market approach (Comparable Companies Multiple, Comparable Transactions Multiple) was considered unfit to arrive at the Enterprise Value (EV) of the company. DCF method takes into account the specific strength of the company and represents the expected performance of the company based on its projections.
Valuation using DCF
Jhamb used the DCF method under the income approach, employing the FCFF methodology. Free cash flows were discounted by the Weighted Average Cost of Capital (WACC). The explicit period considered was from August 21, 2024, to March 31, 2029, with applicable corporate tax rates applied. The enterprise value is the aggregate of the present value of explicit period and terminal cash flows. Cash, cash equivalents, and contingent liabilities were adjusted.
Key Data and Valuation Results:
The valuation yielded the following results (in INR Lacs):
The company's estimated fair value of equity shares is Rs. 40.00 per share.
Definitions
The report also defines key abbreviations, including: BV (Break Up Value), CCM (Comparable Companies Multiple), CCPS (Compulsorily Convertible Preference Shares), DCF (Discounted Cash Flow), D/E Ratio (Debt-Equity Ratio), EBITDA (Earnings before Interest, Taxes and Depreciation and Amortization), EBIT (Earnings Before Interest and Tax), EV (Enterprise Value), FY (Financial Year), NAV (Net Asset Value), EPTL (Ecosure Pulpmolding Technologies Limited), PAT (Profit After Tax), PBT (Profit Before Tax).
Exclusions & Limitations
The valuation is solely for estimating the fair value of equity shares as of August 20, 2024. The report is confidential and intended only for the Client. The scope did not include audit tests or a financial/technical feasibility study. The valuation relies on management assumptions and projections, and is subject to uncertainties and market conditions. The valuer disclaims liability for economic loss or damage arising from the engagement, except as laid out in the engagement letter.
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