GHI Ltd. is considering a new marketing campaign which is expected to run for 4 years. The initial investment required is Rs. 50,00,000. The projected annual benefits from the campaign are as follows:

• Year 1: Rs. 20,00,000
• Year 2: Rs. 25,00,000
• Year 3: Rs. 30,00,000
• Year 4: Rs. 35,00,000
• The company expects the variable costs to be 45% of the benefits, and fixed costs to be Rs. 5,00,000 per year.
• The corporate tax rate is 25%, and the company’s discount rate is 14%.

Required:

1. Compute the Net Present Value (NPV) of the campaign.
2. Calculate the payback period for the campaign.
3. Determine the Internal Rate of Return (IRR) for the campaign.
4. Assess the profitability index (PI) for the campaign.
5. Advise the management on whether to go ahead with the campaign based on the calculated metrics.