QUESTION is: What offer price would you set for the Ferrari's IPO? (must be justified and supported by calculations in excel)

Excel 54 % . 8. 02:27 a Ferrari The 2015 Initial Public Offering, Student Spreadsheet + Garamond 12 . ? Q 5 " = = 2 % % 4,0 00 00 4,0 Q36 fe A B D E F G H 1 L M N Q R S T U First Half 2015 4 2012 2013 2014 2014 3,6% 2015 7,0% 5,0% 3,0% 3,0% 2016 5,0% 5,0% 3,0% 6,0% 2017 4,0% 5,0% 3,0% 6,0% 2018 4,0% 5,0% 3,0% 6,0% 2019 3,0% 5,0% 3,0% 6,0% 1 695 77 385 69 1 1655 188 412 80 1 181 1944 311 417 91 1 007 121 212 40 12,5% 9,1% 24 9% 13,0% 10,0% 25,0% 13,5% 10,0% 27,0% 14,0% 10,0% 28,0% 14,0% 10,0% 30,0% 31 dec 2013 31 dec 2014 30-Jun-2015 Cash and casi 798 1 077 258 Trade receiva 206 184 154 Receivables f 863 1 224 Inventories 238 296 352 Other current 115 64 100 Total curren 2 219 2845 2 045 Investments a 37 47 48 Deferred tax 42 112 149 Property, plas 568 585 589 Intangible ass 242 265 283 Goodwill 787 787 787 Total assets 3 895 4 641 3 900 Sales Cars and S Engines 2 Sponsorshi Other (4) Total Sales Cost of Sales Depreciation Selling, Gene Research and Other Operat Operating It Net Financial Profit befor Income Tax 1 ] Net Profit 14,0% 10,0% 30,0% 2 335 964 270 260 479 2 2 762 1217 289 300 1 387 592 130 152 291 541 26 2,0 2.2 2.2 2 225 961 238 243 431 17 335 1 335 101 233 22 1,9 3.2 34% 2,1 3,3 34% 3.2 34% 3,5 34% 3,7 34% 3,8 34% 364 3 366 120 246 389 9 398 133 265 218 -27 191 65 126 5 Assumptions 6 6 Growth in Cars Shipped 7 Growth in Revenue/Car 8 Growth in Engine Revenue 9 Growth in Other Revenue 10 11 Operating Margin - Cars 12 Operating Margin - Engines 13 Operating Margin - All Other Revenue 14 15 Net Working Capital Turnover 16 Net Fixed Asset Turnover 17 Deprec. & Amort./PP&E 18 19 Financial Forecast 20 Car Shipments (000s) 21 Avg Revenue per Car (Euro 0005) 22 Car Revenue 23 Engine Revenue 24 All Other Revenue 25 Total Revenue 26 . 27 Operating Profit - Cars 28 Operating Profit - Engines 29 Operating Profit - All Other Revenue 30 Total Operating Profit 31 32 Net Working Capital 33 Net PP&E and Int. Assets 34 Deprec. & Amort 35 36 Total Revenue Growth 37 EBITDA Margin 38 39 Source: Case Writer Estimates 7,26 268 1944 311 507 2 762 Capital Expe 258 Trade payable Current tax Other current Total curren Long-term dc Other liabiliti Total equity Total liabilit 7,76 281 2 184 320 523 3 027 271 486 104 475 1 065 317 197 2316 3 895 8,15 295 2 408 330 554 3 292 330 151 536 110 274 1 420 510 233 2 478 4641 8,48 310 2 629 340 587 3 556 8,82 326 2 871 350 623 3 844 9,08 342 3 105 361 660 4 126 578 182 836 1 595 2 267 239 201 3 900 Government Bond Yields (Italy) 1 1 year 10 year 368 0,23% 1,70% 243 28 126 284 32 131 325 33 150 402 35 187 435 36 164 198 Corporate Bonds 398 447 508 567 624 669 1 425 851 289 1 513 932 317 1 568 998 339 1617 1 016 345 1 747 1 039 353 1 875 1 086 369 A Euro 191% 1,99% 2 30% 3.43% 4 98 6,79% 10% 9% 7% B 18% 25% 8% 26 8% 25% 25% 25% Exchange Rate USD/EUR 1,1375 Title Page Exh 1 Exh 3 Exh 4 Exh 5 Exh 6 Exh 8 Exh 9 + 1 || + 100 % s 15 . . W P Excel 54 % . 8. 02:27 a Ferrari The 2015 Initial Public Offering, Student Spreadsheet + Garamond 12 . ? Q 5 " = = 2 % % 4,0 00 00 4,0 Q36 fe A B D E F G H 1 L M N Q R S T U First Half 2015 4 2012 2013 2014 2014 3,6% 2015 7,0% 5,0% 3,0% 3,0% 2016 5,0% 5,0% 3,0% 6,0% 2017 4,0% 5,0% 3,0% 6,0% 2018 4,0% 5,0% 3,0% 6,0% 2019 3,0% 5,0% 3,0% 6,0% 1 695 77 385 69 1 1655 188 412 80 1 181 1944 311 417 91 1 007 121 212 40 12,5% 9,1% 24 9% 13,0% 10,0% 25,0% 13,5% 10,0% 27,0% 14,0% 10,0% 28,0% 14,0% 10,0% 30,0% 31 dec 2013 31 dec 2014 30-Jun-2015 Cash and casi 798 1 077 258 Trade receiva 206 184 154 Receivables f 863 1 224 Inventories 238 296 352 Other current 115 64 100 Total curren 2 219 2845 2 045 Investments a 37 47 48 Deferred tax 42 112 149 Property, plas 568 585 589 Intangible ass 242 265 283 Goodwill 787 787 787 Total assets 3 895 4 641 3 900 Sales Cars and S Engines 2 Sponsorshi Other (4) Total Sales Cost of Sales Depreciation Selling, Gene Research and Other Operat Operating It Net Financial Profit befor Income Tax 1 ] Net Profit 14,0% 10,0% 30,0% 2 335 964 270 260 479 2 2 762 1217 289 300 1 387 592 130 152 291 541 26 2,0 2.2 2.2 2 225 961 238 243 431 17 335 1 335 101 233 22 1,9 3.2 34% 2,1 3,3 34% 3.2 34% 3,5 34% 3,7 34% 3,8 34% 364 3 366 120 246 389 9 398 133 265 218 -27 191 65 126 5 Assumptions 6 6 Growth in Cars Shipped 7 Growth in Revenue/Car 8 Growth in Engine Revenue 9 Growth in Other Revenue 10 11 Operating Margin - Cars 12 Operating Margin - Engines 13 Operating Margin - All Other Revenue 14 15 Net Working Capital Turnover 16 Net Fixed Asset Turnover 17 Deprec. & Amort./PP&E 18 19 Financial Forecast 20 Car Shipments (000s) 21 Avg Revenue per Car (Euro 0005) 22 Car Revenue 23 Engine Revenue 24 All Other Revenue 25 Total Revenue 26 . 27 Operating Profit - Cars 28 Operating Profit - Engines 29 Operating Profit - All Other Revenue 30 Total Operating Profit 31 32 Net Working Capital 33 Net PP&E and Int. Assets 34 Deprec. & Amort 35 36 Total Revenue Growth 37 EBITDA Margin 38 39 Source: Case Writer Estimates 7,26 268 1944 311 507 2 762 Capital Expe 258 Trade payable Current tax Other current Total curren Long-term dc Other liabiliti Total equity Total liabilit 7,76 281 2 184 320 523 3 027 271 486 104 475 1 065 317 197 2316 3 895 8,15 295 2 408 330 554 3 292 330 151 536 110 274 1 420 510 233 2 478 4641 8,48 310 2 629 340 587 3 556 8,82 326 2 871 350 623 3 844 9,08 342 3 105 361 660 4 126 578 182 836 1 595 2 267 239 201 3 900 Government Bond Yields (Italy) 1 1 year 10 year 368 0,23% 1,70% 243 28 126 284 32 131 325 33 150 402 35 187 435 36 164 198 Corporate Bonds 398 447 508 567 624 669 1 425 851 289 1 513 932 317 1 568 998 339 1617 1 016 345 1 747 1 039 353 1 875 1 086 369 A Euro 191% 1,99% 2 30% 3.43% 4 98 6,79% 10% 9% 7% B 18% 25% 8% 26 8% 25% 25% 25% Exchange Rate USD/EUR 1,1375 Title Page Exh 1 Exh 3 Exh 4 Exh 5 Exh 6 Exh 8 Exh 9 + 1 || + 100 % s 15 . . W P