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Question 5 a. Al-Karam textile mills has a market potential of constant growth at a rate of 7% for the next 5 years. The prevailing

Question 5 a. Al-Karam textile mills has a market potential of constant growth at a rate of 7% for the next 5 years. The prevailing rate is 12%, while dividend (D) is Rs. 3. By applying DDM (dividend discounting model), what will be the share price to-date?

Question 5 b. At what stage stocks will be stated as undervalue and overvalue?

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