DCF Studio

    INDIGO.NS · NSI · Industrials

    InterGlobe Aviation Limited

    Also onConsensus Drift

    Implied value per share

    INR 4928.89

    Market price

    INR 4920.00

    Implied upside

    +0.2%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    AdjustedReported capital expenditure averages 1.71% of revenue against depreciation of 10.80%. A business cannot depreciate more than it invests indefinitely. Capex has been set to 10.80% of revenue so the forecast is not handed free growth. Override it if the reported figure is right.
    NoteRisk-free rate is an assumption: INR assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    INR 4928.89+0.2%
    Exit multiple
    INR 8179.17+66.2%
    Market price
    INR 4920.00

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (INR). Outflows negative.

    0bn150bn300bnFY27FY28FY29FY30FY31
    Nominal FCFFDiscounted to todayINR
    LineFY27FY28FY29FY30FY31CAGR
    RevenueINR 955.7bnINR 1104.3bnINR 1276.1bnINR 1474.5bnINR 1703.8bn+15.6%
    EBITINR 121.6bnINR 140.5bnINR 162.3bnINR 187.6bnINR 216.7bn+15.6%
    NOPATINR 116.2bnINR 134.3bnINR 155.2bnINR 179.3bnINR 207.2bn+15.6%
    Add depreciation & amortisationINR 103.5bnINR 119.6bnINR 138.2bnINR 159.6bnINR 184.5bn+15.6%
    Less capital expenditureINR -103.2bnINR -119.3bnINR -137.8bnINR -159.3bnINR -184.0bn+15.6%
    Less increase in working capitalINR 51.7bnINR 59.8bnINR 69.1bnINR 79.8bnINR 92.2bn-15.6%
    Free cashflow to firmINR 168.2bnINR 194.3bnINR 224.6bnINR 259.5bnINR 299.8bn+15.6%
    Discount factor0.94780.85150.76500.68730.6175-
    Present valueINR 159.4bnINR 165.5bnINR 171.8bnINR 178.3bnINR 185.1bn+3.8%
    Present Value Of The ForecastINR 860.1bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate6.80%INR assumption - no free live source available for this market (assumption)
    Equity risk premium8.00%Market assumption
    Beta0.743Reported 0.617, pulled toward 1.0 (Blume)
    Cost of equity12.75%Risk-free + beta x equity risk premium
    Cost of debt8.15%Interest expense / average total debt
    Market capitalisationINR 1902.4bn71.0% of capital
    Total debtINR 777.5bn29.0% of capital, book value as a proxy
    Tax rate4.4%Effective, capped at statutory
    WACC11.31%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 shareINR 4928.89

    62% of EV

    Forecast FCFF, final year
    INR 299.8bn
    Capex at depreciation, working capital in reinvestment
    INR 207.6bn
    Less reinvestment at g/ROIC (4.2% of NOPAT)
    INR -8.6bn
    Capitalised
    INR 198.9bn
    ROIC (reported)
    60.0%
    Terminal value, undiscounted
    INR 2314.7bn
    Terminal value, discounted
    INR 1429.2bn
    Enterprise value
    INR 2289.4bn
    Less net debt
    INR 384.1bn
    Equity value
    INR 1905.2bn

    Exit at 10.8x EBITDA

    Value per shareINR 8179.17

    76% of EV

    Terminal value, undiscounted
    INR 4349.5bn
    Terminal value, discounted
    INR 2685.6bn
    Enterprise value
    INR 3545.8bn
    Less net debt
    INR 384.1bn
    Equity value
    INR 3161.6bn

    Spread between methods: 50%.

    Sensitivity

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

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    9.31%5897.846191.896528.686918.387374.65
    10.31%5163.375381.755627.735906.976226.79
    11.31%4576.734743.504928.885136.255369.81
    12.31%4097.004227.234370.474528.814704.82
    13.31%3697.113800.703913.634037.274173.25

    Outlined: this model. Green text: above today's price of 4920.00. 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 year15.6%15.5%-0.0pp
    EBIT margin12.7%12.7%-0.0pp
    Discount rate11.3%11.3%+0.0pp
    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.