Calculate the intrinsic value of Toyota shares using the free cash flow model of the spreadsheet abpve. Treat each scenario independently.

a) Toyotas P/E ratio starting in 2025 (cell G3) will be 11.5.

PV(FCFF) = instrinsic value = ? per share=?

PV(FCFE)= intrinsic value=? per share= ?

b) Toyotas unlevered beta (cell B22) is 0.65.

PV(FCFF) = instrinsic value = ? per share=?

PV(FCFE)= intrinsic value=? per share= ?

c) The market risk premium (cell B27) is 7.5%.

PV(FCFF) = instrinsic value = ? per share=?

PV(FCFE)= intrinsic value=? per share= ?

\begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|} \hline & & 2021 & 2022 & 2023 & 2024 & 2025 & & & & & \\ \hline \multicolumn{11}{|l|}{ A. Input data } & \\ \hlineP/E & & 12.50 & 12.38 & 12.25 & 12.13 & 12.00 & & & & & \\ \hline Cap spending/shr & & 25.80 & 8.50 & 14.35 & 20.20 & 26.05 & & & & & \\ \hline LT Debt (\$M) & & 109,000 & 26,000 & 53,833 & 81,667 & 109,500 & & & & & \\ \hline Shares (million) & & 1,375 & 1,880 & 1,707 & 1,533 & 1,360 & & & & & \\ \hline EPS & & 15.15 & 7.60 & 10.52 & 13.43 & 16.35 & & & & & \\ \hline Working capital & & 7,000 & 3,000 & 5,000 & 7,000 & 9,000 & & & & & \\ \hline \multicolumn{12}{|l|}{ B. Cash flow calculations } \\ \hline Profits (\$M, after tax) & & 21,100 & 14,325 & 17,083 & 19,842 & 22,600 & & & & & \\ \hline Interest (\$M, after tax) & & 2,153 & 514 & 1,063 & 1,613 & 2,163 & & \multicolumn{3}{|c|}{= (1-tax_rate) r_debt LT Debt } & \\ \hline Chg working cap (\$M) & & & 4,000 & 2,000 & 2,000 & 2,000 & & & & & \\ \hline Depreciation (\$M) & & 16,000 & 18,000 & 17,833 & 17,667 & 17,500 & & & & & \\ \hline \multirow[t]{2}{*}{ Cap spending (\$M) } & & & 15,980 & 22,463 & 28,945 & 35,428 & & & & & \\ \hline & & & & & & & Terminal value & & & & \\ \hline FCFF (\$M) & & & 20,859 & 11,517 & 8,176 & 4,835 & 332,621 & & & & \\ \hline FCFE (\$M) & & & 62,655 & 38,287 & 34,396 & 30,505 & 210,868 & \multicolumn{3}{|c|}{ assumes fixed debt ratio after 2023} & \\ \hline \multicolumn{11}{|c|}{ C. Discount rate calculations } & \\ \hline Current beta & 0.8 & & & & & & & from Value Lin & & & \\ \hline Unlevered beta & 0.603 & & & & & & & \multicolumn{3}{|c|}{ current beta /[1+(1-tax)*debt/equity)] } & \\ \hline Terminal growth & 0.05 & & & & & & & & & & \\ \hline tax_rate & 0.21 & & & & & & & & & & \\ \hline r_debt & 0.025 & & & & & & & \multicolumn{2}{|l|}{ YTM on LT debt } & & \\ \hline Risk-free rate & 0.02 & & & & & & & & & & \\ \hline Market risk prem & 0.08 & & & & & & & & & & \\ \hline MV equity & & 263,750 & & & & 271,200 & & \multicolumn{2}{|l|}{ Row 3 Row 11} & & \\ \hline Debt/value & & 0.2924 & 0.2912 & 0.2900 & 0.2888 & 0.2876 & & \multicolumn{3}{|c|}{ linear trend from initial to final value } & \\ \hline Levered beta & & 0.8000 & 0.7989 & 0.7977 & 0.7966 & 0.7955 & & \multicolumn{3}{|c|}{ unlevered beta x[1+(1-tax)*debt/equity } & \\ \hline k_equity & & 0.0840 & 0.0839 & 0.0838 & 0.0837 & 0.0836 & 0.0836 & \multicolumn{3}{|c|}{ from CAPM and levered beta } & \\ \hline WACC & & 0.0652 & 0.0652 & 0.0652 & 0.0652 & 0.0653 & 0.0653 & \multicolumn{3}{|c|}{ (1-t)*r_debt*D/V + k_equity*(1-D/V) } & \\ \hline PV factor for FCFF & & 1.0000 & 0.9388 & 0.8813 & 0.8273 & 0.7766 & 0.7766 & \multicolumn{3}{|c|}{ Discount each year at WACC } & \\ \hline PV factor for FCFE & & 1.0000 & 0.9226 & 0.8512 & 0.7855 & 0.7248 & 0.7248 & \multicolumn{3}{|c|}{ Discount each year at k_equity } & \\ \hline D. Present values & & & & & & & & Intrinsic val & Equity val & Intrin/share & \\ \hline PV(FCFF) & & & 19,581 & 10,150 & 6,764 & 3,755 & 258,318 & 298,568 & 189,568 & 137.87 & \\ \hline PV (FCFE) & & & 57,805 & 32,592 & 27,017 & 22,112 & 152,847 & 176,763 & 176,763 & 128.56 & \\ \hline \end{tabular}