Wine$-$alot Pvt Ltd is thinking of introducing a new line of drinking glasses, for which it has decided to

purchase new machinery. Ruby Manufacturers are offering their machinery at Rs $50$ lakhs. The

machinery is said to have a life cycle of $10$ years. Wine$-$alot has already pitched their product to

several prominent restaurants, hotel chains, and home ware stores and the response has been very

positive. They estimate an annual return of Rs $8\mathrm{.}5$ lakhs per year for the first $3$ years, and $10$ lakhs

per annum for the next $3,$ and Rs $20$ lakhs every year for the remaining $4$ years. The estimated

operating costs of the machine are Rs $3$ lakhs per annum. The WACC of Wine$-$alot Pvt Ltd is $10\%$ p$.$a$.$

and corporate tax rate is $30\%.$ Calculate

a$)NPV(6$ marks$)$

b$)$ IRR $(6$ marks$)$

c$)$ MIRR $(6$ marks$)$

Evaluate the parameters calculated by you to decide if it makes sense to go ahead with the

introduction of the new glassware line? Whatever your answer may be$,$ give reasons for the

same. $(2$ marks$)$