u/Low-Court5382

Free Cash Flow Valution - EQUITY
▲ 4 r/cfaindia+1 crossposts

Free Cash Flow Valution - EQUITY

https://preview.redd.it/6z07qdjgti2h1.jpg?width=738&format=pjpg&auto=webp&s=0278d99a713674ccb5f29e45ffd4b1f31a35b35b

https://preview.redd.it/rru9j10hti2h1.jpg?width=738&format=pjpg&auto=webp&s=fea839a5e48b32e5936b9865f4bf7944a4b9c521

https://preview.redd.it/bozudro2ui2h1.jpg?width=738&format=pjpg&auto=webp&s=a551bedbe01822769af7a7b5cca45284e62fa4b0

So the two formulas which are confusing me - 1) FCFE=NI+DEP-(FCI+WCI)+Net Borrowings

  1. FCFE=NI- Equity Inv ( Weight of Equity*(FCI-DEP+WCI)

In the above ques 12, we have used the first formula. Both the formulas result in diff values. How do we identify when to use which formula?

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u/Low-Court5382 — 1 day ago