DCF Studio

    F34.SI · SES · Consumer Defensive

    Wilmar International Limited

    Also onConsensus Drift

    Implied value per share

    SGD 3.35

    Market price

    SGD 3.68

    Implied upside

    -9.1%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · USD model at 1.2757

    AdjustedReports in USD, trades in SGD. Modelled in USD, converted at the end.
    AdjustedCapital expenditure runs at 2.6% of revenue against depreciation of 1.8%. A perpetuity has to be a steady state, so the terminal year uses maintenance capex at depreciation and then charges the reinvestment terminal growth requires (g/ROIC of NOPAT). The bridge is shown under Terminal Value.
    NoteRisk-free rate is an assumption: USD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    SGD 3.35-9.1%
    Exit multiple
    SGD 5.37+45.9%
    Market price
    SGD 3.68

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn2bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30CAGR
    RevenueUSD 69.4bnUSD 68.5bnUSD 67.6bnUSD 66.6bnUSD 65.7bn-1.4%
    EBITUSD 2.3bnUSD 2.3bnUSD 2.2bnUSD 2.2bnUSD 2.2bn-1.4%
    NOPATUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.7bnUSD 1.7bn-1.4%
    Add depreciation & amortisationUSD 1.3bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bn-1.4%
    Less capital expenditureUSD -1.8bnUSD -1.8bnUSD -1.8bnUSD -1.8bnUSD -1.7bn-1.4%
    Less increase in working capitalUSD 339.9mUSD 335.3mUSD 330.7mUSD 326.1mUSD 321.6m+1.4%
    Free cashflow to firmUSD 1.6bnUSD 1.6bnUSD 1.5bnUSD 1.5bnUSD 1.5bn-1.4%
    Discount factor0.97690.93220.88960.84890.8100-
    Present valueUSD 1.5bnUSD 1.5bnUSD 1.4bnUSD 1.3bnUSD 1.2bn-5.9%
    Present Value Of The ForecastUSD 6.9bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.20%USD assumption - no free live source available for this market (assumption)
    Equity risk premium6.50%Market assumption
    Beta0.403Reported 0.109, pulled toward 1.0 (Blume)
    Cost of equity6.82%Risk-free + beta x equity risk premium
    Cost of debt4.20%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationUSD 23.0bn42.5% of capital
    Total debtUSD 31.1bn57.5% of capital, book value as a proxy
    Tax rate21.5%Effective, capped at statutory
    WACC4.79%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 2.62

    81% of EV

    Forecast FCFF, final year
    USD 1.5bn
    Capex at depreciation, working capital in reinvestment
    USD 1.7bn
    Less reinvestment at g/ROIC (52.2% of NOPAT)
    USD -894.2m
    Capitalised
    USD 820.1m
    ROIC (WACC floor)
    4.8%
    Terminal value, undiscounted
    USD 36.7bn
    Terminal value, discounted
    USD 29.7bn
    Enterprise value
    USD 36.6bn
    Less net debt
    USD 20.2bn
    Equity value
    USD 16.4bn

    Exit at 14.5x EBITDA

    Value per shareUSD 4.21

    85% of EV

    Terminal value, undiscounted
    USD 48.9bn
    Terminal value, discounted
    USD 39.6bn
    Enterprise value
    USD 46.5bn
    Less net debt
    USD 20.2bn
    Equity value
    USD 26.3bn

    Spread between methods: 46%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    2.79%8.7311.1521.67——
    3.79%4.114.144.174.206.10
    4.79%2.582.602.622.652.67
    5.79%1.581.591.611.631.65
    6.79%0.870.890.900.920.93

    Outlined: this model. Green text: above today's price of 2.88. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    Revenue growth, every year-1.4%1.1%+2.5pp
    EBIT margin3.3%3.5%+0.1pp
    Discount rate4.8%4.6%-0.2pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.