Your team is preparing a valuation of a private company, Company A. Due to the limited data on Company A, you should use a comparable companys data to base your assumptions on. Your manager has identified comparable company Breville Group Ltd (ASX code: BRG) which is in the same industry with a similar capital structure and market risk to Company A. Your manager has provided you with the following information about Company A:

- Forecast of Free Cashflow to the Firm (FCFF) for the next 5 years:

Y1	Y2	Y3	Y4	Y5
$65,743,000	$70,345,000	$74,556,000	$78,294,000	$81,426,000

(Of course, you would expect the company to continue past year 5.)

- Net Income (Year 0) = $74,718,000

- No of shares outstanding = 100,000,000

- Long term debt = $120,644,300

Your manager has also provided this information:

- Australian market risk premium = 6%

- Company tax rate 30%.

Please prepare a spreadsheet (using Excel) and value Company A using the information detailed above and assumptions based on the comparable company. You must clearly state any assumptions you have made and show the support and justification for these assumptions (that is, your rationale and/or research source). Make sure your assumptions are thorough, reasonable and well-grounded. Ensure your spreadsheet includes the following:

a) calculated cost of capital (5marks)

b) discounted cash flow valuation for company A and per share value (4 marks)

c) valuation of company A using a P/E ratio, per share value (1 mark)