14. A company is considering two mutually exclusive projects. Project P will require gross investment of *250 million, and working capital of *50 million. It is expected to have a useful life of ten years and a salvage value of 30 million at the end of ten years. At the end of five years, an additional investment of 45 million will have to be made to restore the efficiency of the equipment. The additional investment will be written off to depreciation over the last five years. The project is expected to yield before-tax cash flow (annual) of *90 million. Project Q will require an investment of *300. million and working capital of 60 million. It is expected to have a useful life of ten years with a residual salvage value of $25 million at the end of ten years. The annual cash flow returns from this project before income tax have been estimated at *80 million for each of the first five years, and at *160 million for each of the last five years. Depreciation is to be charged at 15 per cent on declining balance on the block of assets as per the current tax laws in India. The corporate income tax rate is 30 per cent, and the opportunity cost of capital is 18 per cent. Calculate the NPV for each project. Which project is better?