5 Financing Decision

8/12/2019 5 Financing Decision

1/26Financing Decisions

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T C C, C F T I', , . 48 (J 1958), 261297.

() P C M:

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() D P 100%.

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F D

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F D

9

C EBIT,

D & E (1:1)

F D

10

A 1% A 1%

.. 1% E & 1% D

0.01DL 0.01 I

0.01EL 0.01 (EBITI)

0.01DL + 0.01EL= 0.01L

0.01 EBIT

0.01E 0.01 EBIT

= 0.01 0.01 EBIT

T 0.01 EBIT. T (L

O P), 0.01= 0.01L

=



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1% D L ,

1% E .

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0.01 0.01DL 0.01 EBIT 0.01 I

0.01( DL ) 0.01 (EBIT I)

0.01EL 0.01 (EBIT I)

= 0.01(L DL) 0.01 (EBIT I)

A, 1% E L

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=

F D

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F D

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A E

N. S 1000

P S 10

M E 10000

A B C D

EBIT 500 1000 1500 2000

EPS 0.50 1.00 1.50 2.00

ROE 5% 10% 15% 20%

E E & D

N. S 500

P S 10

M E 5000

M D 5000 @ 10%

A B C D

EBIT 500 1000 1500 2000

I 500 500 500 500

EPS 0.0 1.0 2.0 3.0

ROE 0% 10% 20% 30%E 2

1.00 2.00 3.00 4.00

L I @10% 1.00 1.00 1.00 1.00

N 0.00 1.00 2.00 3.00

R R 10

(%) 0% 10% 20% 30%

A R. 10/ ,

R. 10/ @ 10% &

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A , EPS .

F D

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EPS (R.) 1.50 2.00

P S (R.) 10.00 10.00

ROE 15% 20%

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ROE 15% 20%.



A ,

(A) :

S D & E.

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F D 15

A

EBIT =

M S

A d e

D Er = r * + r *

E+D E+D

E

A A

D = + ( )*

E

T P 2 MM .

, A,

, (A)*(D/E)

.

F D

16



F D

17

A E

N. S 1000

P S 10

M E 10000

A B C D

O

I 500 1000 1500 2000

EPS 0.50 1.00 1.50 2.00

ROE 5% 10% 15% 20%

E E & D

N. S 500

P S 10

M E 5000

M D 5000 @ 10%

A B C D

O

I 500 1000 1500 2000

I 500 500 500 500

EPS 0.0 1.0 2.0 3.0

ROE 0% 10% 20% 30%

{ } { } 15%10% * =15%+ 1 =20%

A

O I =

M

A

1500 = =15%

10000

A A

D = + ( )*

E

, A,

,

(A)*(D/E) .

F D

18

P 1

, P 2

, .

EB . 1500 . 500 C

A E:

EPS 1.50 0.50 1.00

ROE 15% 5% 10%

D & E (1:1):

EPS 2.00 0 2.00

ROE 20% 0 20%

DE



F D

19

A ,

D/E.

A D/E ,

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T D/E

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A

D D

S,

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F D20

A d e

D E= * + *

E+D E+D

e A A e

D= + ( - )*

E

A D/E,

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L MM H: L

S

T

C T

F D 21

I , MM

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I 1963, MM

C I T C C : A C', , . 53 (J 1963),

433 443.

F D 22



N O I (EBIT) 2,500 2,500L I (R 5,000/ D @10%) 500

I T 2,000 2,500

C T @50% 1,000 1,250

I T 1,000 1,250

C

D S 1,000 1,250

I 500

T I I 1,500 1,250

I T S 250

A 100% D

F L , I C.

I T S = I C * C T

I T S = T INT = T D

F D 23

T L

I T S.

After Tax Income of Levered firm - After Tax income of Unlevered firm = Interest Tax Shield

P T S: A , I

T DP I T S = =TD

T, P I T S

.

= 50%*5000=2500

F D 24



MM (Contd.)

F D 25

I MM H C T:

D T ,

C S.

H, O C S

100% .

I , ,

.

MM .

100%?

I C P T

B I C, .

F D 26



C &

F .

I P T . F , C &

P I T ,

C S .

A (C &

P I T)

F D 27

C &

N O I (EBIT) 100 100

L I 100 0

I T 0 100

C T @ 50% 0 50

I T 0 50

C

D S 0 50

L T D @ 30% 0 15

N I S 0 35

I 100 0L T I @ 40% 40 0

N I D 60 0

T T (C + P) 40 65

B &

F D 28



C &

N O I (EBIT) 100 100L I 100 0

I T 0 100

C T @ 40% 0 40

I T 0 60

C

D S 0 60

L T D @ 20% 0 12

N I S 0 48

I 100 0

L T I @ 40% 40 0

N I D 60 0

T T (C + P) 40 52

A C & E ,

.F D 29

F I :

A (1T)

C & P :

(1T )(1T )

F D 30

(1T )(1T )

(1T )



L F I E :

L :

C :

F T = F

S T = I T S C & P

T

( D)(1T )(1T )

F D 31

(1T )(1T ) D(1T )(1T )

D(1T )

(1T )(1T ) D(1T )(1T )+ D(1T )

F T S T

(1T )(1T )+ D (1T ) (1T )(1T )

F T:

S T:

L F:

L F = F + P I T

L

(1T ) (1T ) = + D 1

(1 T )

F D 32

(1T )(1T )

(1T )

D (1T ) (1T )(1T )

(1T )

D (1T ) (1T )(1T )(1T )(1T )+

(1T ) (1T )



T, :

C T P T I I

P T E I

A :

C T ,

P T I I ,

P T E I .

F D 33

F D

.

F O ,

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F D

D C:

I

D

& O

P A,

C:

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CQ , F

, R

S

I

S

M

F D .

= F

+

F D

F D 34



A , ,

F D

C

F D 35

A (1984) .

B , .

T .

1 C: F A ; N F

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2 C: D L ; .(S D, , )

F

F D 36



L C: E E , I

.

P , .

G P , D

E , E E &

I.

I E

, E E

.

F (C.)

F D 37

H ,

.

L

.

P O F (C.)

F D 38



E L

EBIT & EPS. C

EBIT .

F D 39

EBIT EPS A

ABC L 200,000 E (M R100 L) & EBIT R 20 L. T . R. 50 L , :

P 1: I 100,000 E @ R 50/ S;

P 2: I 12% D.

A , EBIT R.24 L. T R 40%.

1 2

EB 24,00,000 24,00,000

I 6,00,000

EBT 24,00,000 18,00,000

T 9,60,000 7,20,000

PAT 14,40,000 10,80,000

P D.

E E 14,40,000 10,80,000

N. S 3,00,000 2,00,000

E 4.80 5.40F D 40

EBITEPS A (C.)



F D 41

1 2

EB 0 6,00,000

I 0 6,00,000

EBT 0 0

T 0 0

PAT 0 0

P D. 0 0

E E 0 0

N. S 3,00,000 2,00,000

E 0 0

EBITEPS A (C.)

F D 42

EB ( )

E

()

1 A

E

2 A D

EBIT EPS A

2418

(6,0)

(24,5.4)

(24,4.8)

(0,0)

D

E



F D43

=

1 2

E . D :

B E EB* = 18,00,000

EBITEPS A (C.)

1

(EB* )(1)D

. ( )

2

(EB* )(1)D

. ( )

(EB* 0)(10.40)0

3,00,000

(EB* 6,00,000)(10.40)0

2,00,000=

EBITEPS A

EPS.

EBITEPS

:

C E L EBIT

A EBIT

.

F D

44

EBITEPS A (C.)



C S

P, R, F, C .E :

T :

) B R EBIT. D

: D ; P ;

I ; % F C .

) F R .

T R . I B

, , B ,

.

F D

45

G C

A :

I , .

H, .

:

T ,

.

B , .

F

.

L ,

.

F D

46

G C (C.)



C . F :

R . C

:

100%:M

. T

50%,

. N

.

50%: M

, .

26%: E . D

& .

F D

47

G C (C.)

: C I .

, :

() D

;

() D ;

() D ;

() D ;

() D

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F D

48

G C (C.)



F :

I , .

F ,

.

T

,

.

CP, F, S, ADR/GDR .

F D

49

G C (C.)

F :

I ,

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I ,

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I .

F D

50

G C (C.)


26/26

& :

L & .

T, ,

.

R A , &

, , ,

.

L C

F D

51

G C (C.)

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