ano 4 The Executive Accislant ( EA) to the CFO of ABC Led was gluey the task of analyzing the value of a renovation project for Plant A. The fire casts are provided below, was presented to the EA by the plant manager, All values are INR million, The corporate tax rate is 25% Year 2 3 4 . 15 . . 1. Initial Investment (CAPEX ) 70 0 2 . Revenues 350 360 370 380 300 3 . Variable Cast 90 95 100 105 160 4. Depreciation 140 140 140 140 140 5. Fixed costs. 14 14 14 14 14 6. Interest expense. 20 20 20 18 18 7. Net proceeds in debt - 140 8, Principal on debt which is Repaid 30 110 9 change, in operating networking capital. 70 290 360 Project the free cash flow to the equity holders with the above data for all years 0 to year 5. If the cost of equity capital is 14 %% what is the value to the renovation project for plant A ? should test they go ahead with the renovation ? why or why not? are There 200 no preferred equity holders