Ashley Homebuilding is about to go public. The investment firm of Blake, Webber, and Company is attempting to price the issue. The

home building industry generally trades at a $25$ percent discount below the P$/$E ratio on the S&P$/$TSX Composite Index. Assume that

index currently has a P$/$E ratio of $25.$ The firm can be compared to the home building industry as follows:

Assume, in assessing the initial P$/$E ratio, the investment dealer will first determine the appropriate industry P$/$E based on the S&P$/$TSX

Composite Index. Then a quarter point will be added to the P$/$E ratio for each case in which Ashley Homebuilding is superior to the

industry norm, and a quarter point will be deducted for an inferior comparison.

What should the initial P$/$E be for the firm? $($Round the final answer to $2$ decimal places.$)$

Initial P$/$E ratio