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Could you help me to solve this question? b) C) Omega Ltd has just raised Several billion dollars from an initial public offering and its

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Could you help me to solve this question?

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b) C) Omega Ltd has just raised Several billion dollars from an initial public offering and its shares are just about to go public (traded on a stock exchange). The shares were issued at $40 each and based on current earnings (EPS $0.25) gives it a trailing P/E ratio of 160! Assuming that Omega Ltd has a retention ratio of around 70% and the di5count rate for a similar public firm is 15%, do you believe the share price of Omega is likely to increase/ decrease or stay the same when it goes public? Provide supporting calculations. Alpha Ltd has been in operation for the last 5 years and has been unprofitable, making a loss of $150,000 pa. A significant part of this loss is due to annual depreciation of $100,000 pa on equipment and $200,000 in interest expense on a 52m loan. Although Alpha has kept up with the annual interest payment each year it has not met any principal payments. The management of Alpha believe that there is a 20% chance that a new product will receive approval from regulators in the near future, and if approved, will improve earnings by 55m pa and save the company from bankruptcy. Reguired: Using FCFF methodology, determine the value of eguig for Alpha under the following set of assumptions and the amount of money that creditors (banks) are likely to lose. 0 Tax rate is 30% (ignore any complications associated with tax, such as tax losses carried forward etc) 0 Assume that no further investments in WCan and FClnv are required and that no additional costs are associated with the new product 0 Alpha has a beta of 1.8, the equity risk premium is 6% and Rf is 4% 0 WE ratio is 150% Delta Ltd is engaged in the exploration, development, production and processing of iron ore. Delta's operations are located in Australia and its markets are located in two developing countries that have experienced double digit growth rates in GDP for the last 10 years since the introduction of structural reform of their economies. Delta's revenues have experienced similar growth rates over this period. Outline an approach to estimate revenues over the short to medium term as well as in the long term

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