These are the slides presented for the Final round of Capitalizer 2019 organized by BUP Finance Society. We made the valuation and presented in front of the judge

1. 2004

2. 2004 2014

3. Why
NOKIA
Failed
?
Not Adopting
Technological
Change
Not Taking
Customers
Need in Mind

4. T
E
C
H
L
A
N
D
O
Sells
Motherboard
Chipset,
Memory,
Processor
Short
Product
Life Cycle
Fast
Technological
Change
Lower
Profit
Margin
Intense
Competition

5. Team
FINCAST

6. PRESENTATION OUTLINE
AGENDA
INDUSTRY OUTLOOK
FINANCIAL PLANNING & ISSUES
BUSINESS ANALYSIS
INVESTMENT THESIS
FUNDING ALTERNATIVES

7. BUSINESS ANALYSIS

8. SOME FACTS ABOUT TECHLANDO CORPORATION
8.11%
Market Share in
Semiconductor
Industry
2018
10.25%
Sales Growth
in 2018
8.94%
Average ROE
from 2016-18
$ 178.5
Million
Turnover
In 2018

9. REVENUE COMPOSITION
80%
20%
Revenue Decomposition
Memory, Processor & Chipsets
High Performance Eletronic Componests
Major Growth of Techlando is driven from the
Sales of Memory, Processor & Chipsets
Techlando Strategically Focus on using technology
that ensure performance- faster, use less power, less
resistant to failure and continues store information
Techlando Sells through OEMs, Distributors &
Retailers
OEMs- original equipment manufacturer, an organization that makes devices from component parts bought from other organizations.
Strategically- Techlando Focuses on the fast
Growing segment of the Market
5
Strategically- Memory, Processor & Chipsets
are STARS for Techlando

10. Source:
STRENGTH OPPORTUNITY RISKSWEAKNESS
STRENGTHS OF TECHLANDO
Highly Skilled Research Technicians and Scientists
Product Reputation in Semiconductor Market
Strong Focus on Research and Development

11. WEAKNESS FOR TECHLANDO
Low Profit Margin (2.8% PM)
Working Capital Finance- Unable to Meet WC needs
(84% of Assets are concentrated in Current Assets on Average)
STRENGTH OPPORTUNITY RISKSWEAKNESS
High COGS (82.2% of Sales on Average 2016-18)

12. OPPORTUNITIES FOR TECHLANDO
Source:
Favorable Industry Growth Drivers (Industry is expected to grow by
>30% in the next 5 years)
STRENGTH OPPORTUNITY CHALLENGESWEAKNESS
Consumer increasing Demand for High Performance Components

13. CHALLENGES FOR TECHLANDO
Consumer Acceptance - Changing Customers Needs &
Preference
Product Obsoletion- from the Introduction of New product from
Competitors
Slowdown in Industry Growth & Economy
STRENGTH OPPORTUNITY RISKSWEAKNESS

14. KEY TAKEAWAY
Business Analysis
1 2 3
Industry Analysis Financial Planning
Techlando’s Good Market Position
Efficient & Strong Human Capital
CAGR of 7.57% (2016-18) & Has
higher Growth Potential

15. INDUSTRY OUTLOOK

16. KEY FACTS ABOUT THE INDUSTRY- SEMICONDUCTOR INDUSTRY
The Products reflected fast growth, ongoing technological change, brief product
life cycles, changing customer wants and needs
Large Number
of Firms
The Industry is segmented into a number of Product Segments
Motherboard chipsets, Memories, Processors comprised the fastest growing
segment in the overall industry
As Electronic Devices are getting more Complex and Powerful There has been a
Rapid increase in the demand for high Performance electronic components
Rapid Growth
2016-2018

17. 7000-8000
Crore BDT
0
1
2
3
4
5
Threat of New
Entrance
Threat of
Substitudes
Rivalry Among
Competitors
Bargaining
power of
Supplier
Bargaining
power of Buyer
PORTER’S FIVE FORCES- ELECTRONIC COMPONENTS
The Market is highly competitive with a number of
large tech Giants as well as smaller specialized
firms
Bargaining Power of Customer are very
high for the Large No. of firms and
product offering
High Rivalry among firms impacts
profitability (Low Profit Margin)
Legend:
0 No threat
1 Very Low
2 Low
3 Moderate
4 High
5 Very High

18. Competitors Analysis – GPRV
How is Techlando Performing Compare to its Close Competitors?
0
1
2
3
4
5
6
7
8
9
10
Sales Growth
EPS Growth
Net Profit Margin
ROE
BetaDebt/Capital
P/E
P/B
GPRV ANALYSIS
Techlando Techsistential Archito, Inc. ZOQQTechlando is on second highest growth co.,
where ZOQQ has highest growth in sales
and EPS.
Techlando is now risky, but more
undervalued than competitors
Techlando is moderately profitable than
competitors

19. 0.8 1.3
2.2
3.51
5.6
7.7
10.6
2016 2017 2018 2019 2020 2021 2022
FUTURE OUTLOOK
Time
Actual
Expected
65.83%
CAGR
59.54%
CAGR
48.16%
Growth Potential
37.58%
CAGR
Amount in $ billion….

20. WHAT DRIVES DEMAND ?
Increasing Sales of Smartphones Youth Population Growth1
2
3
4
Growing Economy
Product Development & Product
Offerings5
Increasing Demand for Laptops &
Net Books

21. KEY TAKEAWAY
48.16% Growth Potential
Techlando- Exposer to $ 3.52 billion Market this
year with a turnover potential of $281.6 million
TechLando can Play a significant part with
Selective Investment for Growth
Business Analysis
1 2 3
Industry Analysis Financial Planning

22. FINANCIAL PLANNING
& ISSUES

23. 65.83% 65.83%
59.54% 59.54%
37.58%
37.58%
4.96%
10.25%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
2017 2018 2019 2020 2021 2022
Industry growth Techlando Growth
TECHLANDO – IS NOT CAPITALIZING ON THE INDUSTRY OPPORTUNITIES (High Growth)
Competitive Environment
- Lower Profitability
Product Issues
- High COGS
- Short Life Cycle
- High Spending on R&D
High Working Capital
- Increasing Account Receivable
- Inventory write-downs
Other Issues
ISSUES – TECHLANDO

24. TECHLANDO- Current Financing Structure is INADEQUATE to meet the needs for Further Growth
ISSUES – CURRENT FINANCING STRUCTURE
0
10
20
30
40
50
60
70
80
90
2019 2020 2021
Financing Requirement
CAPEX NWC
Amount $
56.87%
Fin. GAP
From STF
Techlando has Already Used 70% of Notes
Payable Limit of the Banks & the banks is
Unwilling to extend this limit
Under Current Financing- Techlando would
have a Financing Gap of $21.5 mm in
investing for Growth
Current Financial Planning & Structure is not
Optimal and insufficient to cope with the
increasing sales of the company

25. FUNDING ALTERNATIVES

26. Alternatives of Funding
SHORT
TERM
LONG
TERM
Factoring Factoring with recourse by selling A/R to factor
Notes payable Taking loan keeping A/R as safety
Equity Privately institutional investors will invest
Retained earnings Having retained earnings from net income
Corporate bond Issuing corporate bond graded by AA, A and BBB
1
2
1
2
3

27. Alternatives of Funding Evaluation- Notes payable
Already reached close to the threshold
given by banks (70% limit)
Utilize the money for long term funding
also (doing it from past)
Less costly than factoring (Prime rate + 4%),
2% lower
PROS CONS
Less process needed for Techlando to
do funding
Managing long term debt with this creating
risk of short term burden to pay
Can focus more on regular operation
using factoring

28. Alternatives of Funding Evaluation- Factoring
High cost for funding than notes payable
(Prime rate + 6%). Also higher than long run
debt
Can act as a source of long term fund
Immediate cash flow
PROS CONS
Contingent liability in case of the failure of
account receivables to pay
(for factoring with recourse)
Techlando can focus more on regular
operation using factoring

29. Alternatives of Funding Evaluation- Equity
High cost of capital for company
No restrictions/ covenants
Enough source of funding for long term
PROS CONS
Ownership will be diluted from the current 5
owners in Board of directors
No fixed payment to investors
Floating costs to issue i.e. underwriting
expense etc.
Solely engaged for company operations
without any limits

30. Alternatives of Funding Evaluation- DEBT
Restrictive covenants imposed by lenders
Tax advantage for interest
PROS CONS
Financial distress risk for high debt
No effect on ownership
(Ownership dilution) May need collateral for issuing debt
Predetermined cost of company (interest
and principal payment)
Low cost of capital for company

31. Alternatives of Funding Evaluation- Retained Earning
Low amount to be arranged through this
source
No tax advantage
PROS CONS
Opportunity cost will be equal to cost of
equity, which is also a high rate
Less cost and time consuming for the
collection of fund

32. INVESTMENT THESIS

33. SCENARIO ANALYSIS
Particulars All Equity All Debt All Factoring
Optimum
Structure
Share Price (FCFF) $45.82 $75.65 $67.15 $70.11
Share Price (FCFF+ Residual+ Relative) $31.87 $46.17 $41.89 $43.66
Enterprise Value $186,642,013 $249,323,340 $223,957,181 $245,121,314
Equity Value $194,562,013 $225,681,696 $200,315,537 $234,808,092
Share Issue 1,262,466 - - 365,761
Equity Dilution (Current Shareholders) 30% 0% 0% 11%

34. SCENARIO ANALYSIS
41%
59%
Scenario 3: All factoring
25%
75%
Scenario 4:
Optimum structure
41%
59%
Scenario 2: All debtScenario 1: All Equity
100%
Value: $186,642,013 Value: $249,323,340 Value: $223,957,181
Value: $245,121,314

35. SCENARIO ANALYSIS- Justifying Rejecting All Debt
More Debt Inclusion will Result in more Financial Risk for Techlando.
(Debt has High fixed repayment, so this will create burden for company)
More Debt Inclusion will Create more restrictive covenants. This may
restrict the Company in investing in high yielding but risky project.
High Debt Will Create Negative impact for company which make the
rating of the company to deteriorate
The Debt Increment will Create personal Liability threat for the owner

36. Optimum WACC Exploration
Bond
Rating D/C RatioBond YTM(1-T)N/P(1-T) D/E Ratio
Equity
Beta
Cost of
Equity
Cost of
Debt(90/10) WACC
AA
10% 2.65% 4.35% 11% 1.123 13.45% 2.82% 12.38%
11% 2.65% 4.35% 12% 1.130 13.49% 2.82% 12.32%
12% 2.65% 4.35% 14% 1.138 13.54% 2.82% 12.25%
13% 2.65% 4.35% 15% 1.147 13.59% 2.82% 12.19%
14% 2.65% 4.35% 16% 1.155 13.64% 2.82% 12.13%
15% 2.65% 4.35% 18% 1.164 13.69% 2.82% 12.06%
A
16% 2.84% 4.35% 19% 1.173 13.75% 2.99% 12.02%
17% 2.84% 4.35% 20% 1.182 13.80% 2.99% 11.96%
18% 2.84% 4.35% 22% 1.191 13.86% 2.99% 11.90%
19% 2.84% 4.35% 23% 1.200 13.91% 2.99% 11.84%
20% 2.84% 4.35% 25% 1.210 13.97% 2.99% 11.77%
21% 2.84% 4.35% 27% 1.220 14.03% 2.99% 11.71%
22% 2.84% 4.35% 28% 1.230 14.09% 2.99% 11.65%
23% 2.84% 4.35% 30% 1.241 14.16% 2.99% 11.59%
24% 2.84% 4.35% 32% 1.252 14.22% 2.99% 11.52%
25% 2.84% 4.35% 33% 1.263 14.29% 2.99% 11.46%
BBB
26% 3.75% 4.35% 35% 1.374 14.96% 3.81% 12.06%
27% 3.75% 4.35% 37% 1.376 14.97% 3.81% 11.95%
28% 3.75% 4.35% 39% 1.378 14.98% 3.81% 11.85%
29% 3.75% 4.35% 41% 1.380 14.99% 3.81% 11.75%
30% 3.75% 4.35% 43% 1.383 15.01% 3.81% 11.65%

37. OPTIMAL CAPITAL STRUCTURE
What would Be best for Techlando ?
1
2
This is the point where cost of capital is at the
lowest for Techlando, which makes the firm value
the highest one
This is the point which prevents Techlando from
facing any sort of financial distress along with to
be more conservative in working capital
management
11.20%
11.40%
11.60%
11.80%
12.00%
12.20%
12.40%
12.60%
0% 5% 10% 15% 20% 25% 30%
WACC
Debt/Capital Ratio
25%
Increasing
WACC
Lowest WACC

38. OPTIMAL SOLUTION
What would Be best for Techlando ?
Maximize the Firms Value
Investment Objective: Strategic Focus:
Invest Selective for Growth
Optimal Capital Structure ProposedCurrent Scenario
34% Debt, With Optimal
Assumed to Be 18%.
Short Term Financing Done
through 70% Note Payable
Agreement with Bank
Long term financing done
through Equity
25% Debt
/
75% Equity
Issue A rated 10-years 4.73%,
Bonds with Sinking fund provision
Private Placement of 365761
shares at $25 par
Financing through Notes Payable
Within 70% limit

39. RATING of TECHLANDO- S&P rating (Can we Issue a “A” rated Bond ?)
Moodys rating marks which is comparable to S&P rating
Factors
Weight of
factor Sub factors Weight Category Point Comment
Scale 20%
Revenue 0.10 AAA 1 0.10 Company has revenues more than $40 million
Free cash flow 0.10 BBB 9 0.90 Free cash flow is more than 13 million in 2018
Business profile 20% Business profile 0.20
AAA 1 0.20
Forecastable result volatility and specific product cycle,
market position, BOD with company knowledge
Profitability 5% EBITDA margin 0.05 BBB 18 0.90 EBITDA margin is 12.1%
Leverage 40%
Debt/ EBITDA 0.10 AA 3 0.30 Debt/ Ebitda margin 0.67 times
EBIT/ Interest expense 0.05
A 6 0.30 The margin is 10.21 times
Cash/ Debt 0.10
B 15 1.50 The rate falls within the B margin specfied which is 25.34%
FCF/ Debt 0.15 CCC 18 2.70 The margin is more than 20%
Financial Policy 15% Financial Policy 0.15
AAA 1 0.15
Expected to have feasible financial policy where
conservative approach will be used to finance with
tolerable debt- equity ratio
Total average 7.05
The rating is A
Source: www.moodys.com

40. Source: www.moodys.com
Cost of Capital Analysis
Build up Approach
Particulars Rate
10 Year Treasury Bond 3.71%
Market Risk Premium 6%
Consumer Acceptance Uncertainity Risk
Premium 2%
Technological Obsolescence Risk Premium 1%
Peer Companies
D/C
Ratio D/E Ratio
Equity
Beta Asset Beta
Techsistential 33% 49% 1.25 0.9649
Archito, Inc. 19% 23% 1.36 1.1922
ZOQQ 0% 0% 1 1.0000
Average 1.20 1.05
Particulars Rate
Interest for Notes Payable (3.25% + 4%) 7.25%
Finance Cost for Factoring (3.25% +
6%) 9.25%
YTM for Corporate Bond (AA) 4.41%
YTM for Corporate Bond (A) 4.73%
YTM for Corporate Bond (BBB) 6.25%
Effective Tax Rate 40%
11.46%
WACC
25/75 Optimal Structure

41. COMPANY VALUATION

42. Assumption for Forecast
Assumption
COGS/Sales 81.12%
R&D/Sales 5%
SG&A/Sales 8.34%
Cash/Sales 3.30%
DSO 60
Prepaid expenses/Sales 0.40%
Depreciation 7.51%
DIH 52
PDP 30
Purchases/COGS 60%
Accrued expenses/Sales 0.72%
Income taxes payable/Income tax
expense 10%
Other current liabilities/Sales 0.63%
Stand Alone
Assumption
COGS/Sales 79.00%
SG&A/Sales 8.34%
NWC/Sales 26.15%
D/C Ratio 25%
D/E Ratio 33%
Equity Beta 1.2628
Cost of Equity 14.29%
Interest on Bond(1-T) 2.8%
Interest on Notes Payable(1-T) 4.35%
Cost of Debt (90 : 10) 2.99%
WACC 11.4625%
Terminal Growth Rate(Rf) 3.71%
New Line Product

43. FCFF- VALUATION
Particulars 2019 2020 2021 2022 2023 Terminal
Net Income $ 11,522,304 $ 12,371,028 $ 11,179,208 $ 6,999,596
Add: Depriciation 2,108,936 2,244,116 2,379,296 2,379,296
Add: Interest (1-Tax) $ 792,288 $ 915,852 $ 1,043,992 $ 1,111,924
Capital Expenditure (2,400,000) (1,800,000)
NWC 67,737,113 82,333,176 82,333,176 65,921,601 51,972,774
Changes in NWC (14,596,063) - 16,411,575 13,948,827
FCFF $ (2,572,534) $ 13,730,996 $ 31,014,072 $ 24,439,643 $ 326,943,200
PV Factor 0.947186634 0.89716252 0.804900588 0.72212664 0.647864956 0.647864956
PV of FCFF $ (2,307,981) $ 11,052,087 $ 22,396,087 $ 15,833,588 $ 211,815,042
Enterprise Value $ 258,788,823
Enterprise Value(June-2019) $ 245,121,314
Plus: Cash 7,920,000
Less: Interest Bearing Debt $ 18,233,223
Equity Value $ 234,808,092
Share Price $ 70.11
Equity Diluition of Existing BOD 11%
Capital Gain of Existing BOD 231%

44. RELATIVE - VALUATION
Companies P/E P/BV
Techsistential 6.40411 1.41452
Archito, Inc. 10.73854 2.19746
ZOQQ 10.77519 2.53650
Average 9.30595 2.04949
P/E P/BV
10.20392733 $24.69Share Price
EPS BV

45. RESIDUAL INCOME - VALUATION
Particulars 2019 2020 2021 2022 2023
CSE 53,780,276$ 65,302,580$ 74,517,008$ 81,567,328$ 84,438,036$
Equity Charge 7,683,570 9,329,758 10,646,220 11,653,497
Net profit 11,522,304 12,371,028 11,179,208 6,999,596
Residual Income 3,838,734 3,041,270 532,987 (4,653,901)
PV Discount factor 0.93540922 0.87499041 0.765608217 0.669899848 0.586155942
PV of residual income 3,358,855 2,328,421 357,048 (2,727,912)
Equity value 57,096,689
Equity Value (June-2019) 53,408,770
Number of stocks outstanding 3,349,085
Equity Value per share (RE) 17

46. SHARE PRICE PER- FAIR VALUE
Free cash flow to firm 50%
Residual Income 30%
Relative valuation 20%
43.66
Valuation Method Weight
Per Share price
1
2
3

47. SHARE PRICE PER- FAIR VALUE- Justification
1. 50% for FCFF: Techlando has sales growth and
has positive FCFF from 2020. We have more
reliance on valuing through FCFF.
2. 30% for Residual Income: Terminal value is
uncertain with max. probability for which RI
model is used to get a better result to min. effect
of Terminal Value.
3. 20% for Relative: 3 peer’s were compared and
they are a moderate representative for the
Techlando. That’s why, we have given lowest
weight.

48. PROJECT VALUATION

49. Project Evaluation –(with optimum capital structure)
NPV=
$4,913,982
IRR=
21%
DPBP=
3.34 year
PI=
1.31
ROI=
17%

50. FINANCIAL FEASIBILITY
Financial Feasibility (3 Year)
Particulars 2019 2020 2021 2022 Recovery
Net Income - 3,156,600 4,128,888 4,128,888
Add: Depriciation - 880,000 880,000 880,000
Add: Interest (1-Tax) - 124,872 124,872 124,872
OCF - 4,161,472 5,133,760 5,133,760
Capital Expenditure (4,400,000) (600,000) - - 352,000
∆NWC 11,296,800 14,644,000 14,644,000 5,753,000
Changes in NWC (11,296,800) (3,347,200) - 8,891,000 5,753,000
PCF (15,696,800) 214,272 5,133,760 14,024,760 6,105,000
PV Factor 1 0.89716 0.80490 0.72213 0.72213
PV of PCF (15,696,800) 192,237 4,132,166 10,127,653 4,408,583
Cumulative PV of PCF (15,696,800) (15,504,563) (11,372,397) (1,244,744) 3,163,839
NPV 3,163,839$
IRR 18%
DPBP 3
PI 1.20
ROI 24%

51. FORECASTING SENSITIVITY

52. Project Sensitivity Analysis (NPV)
Sensitivity Analysis(NPV)
WACC
NWConSales
4,913,981.9 8.5% 9.5% 10.5% 11.5% 12.5% 13.5% 14.5% 15.5%
24.50% 7,016,223 6,381,504 5,772,183 5,186,982 4,624,702 4,084,213 3,564,454 3,064,423
25.50% 6,886,003 6,239,013 5,617,959 5,021,536 4,448,519 3,897,752 3,368,151 2,858,691
26.15% 6,801,360 6,146,393 5,517,713 4,913,997 4,334,000 3,776,553 3,240,554 2,724,966
27.50% 6,625,564 5,954,030 5,309,511 4,690,645 4,096,153 3,524,830 2,975,545 2,447,229
28.50% 6,495,344 5,811,538 5,155,287 4,525,200 3,919,970 3,338,369 2,779,241 2,241,498
29.50% 6,365,124 5,669,047 5,001,063 4,359,754 3,743,787 3,151,908 2,582,938 2,035,767
Sensitive to net working capital
Sensitivity Analysis(NPV)
WACC
NWConSales
8.5% 9.5% 10.5% 11.5% 12.5% 13.5% 14.5% 15.5%
24.50% 5.6%
25.50% 2.2%
26.15% 38% 25% 12% 0% -12% -23% -34% -45%
27.50% -4.5%
28.50% -7.9%
29.50% -11.3%
WACC & NWC on sales Grid- NPV

53. Project Sensitivity Analysis (IRR)
Sensitive to net working capital
Sensitivity Analysis(IRR)
SG&A on SalesNWConSales
21% 5.50% 6.50% 7.50% 8.34% 9.50% 10.50% 11.50% 12.50%
25% 27% 26% 24% 22% 20% 18% 16% 15%
26% 27% 25% 23% 21% 19% 18% 16% 14%
26% 26% 24% 23% 21% 19% 17% 16% 14%
28% 25% 23% 22% 20% 18% 17% 15% 13%
29% 24% 23% 21% 20% 18% 16% 15% 13%
30% 24% 22% 20% 19% 17% 16% 14% 13%
Sensitivity Analysis(IRR)
SG&A on Sales
NWConSales
5.5% 6.5% 7.5% 8.3% 9.5% 10.5% 11.5% 12.5%
24.50% 5.2%
25.50% 2.0%
26.15% 24% 15% 7% 0% -10% -18% -26% -35%
27.50% -3.9%
28.50% -6.6%
29.50% -9.1%
WACC & NWC on sales Grid- IRR

54. Techlando Sensitivity Analysis
Sensitivity Analysis(Equity Value)
WACC
TerminalGrowth 234,808,092.0 8.5% 9.5% 10.5% 11.5% 12.5% 13.5% 14.5% 15.5%
2.00% 306,543,004 259,655,924 223,936,627 195,842,379 173,184,952 154,539,776 138,939,558 125,704,450
2.50% 330,407,776 276,794,966 236,738,240 205,697,889 180,956,973 160,789,958 144,048,330 129,938,023
3.00% 358,641,384 296,586,084 251,255,312 216,718,008 189,550,344 167,637,529 149,602,795 134,511,301
3.71% 408,940,574 330,600,832 275,563,480 234,808,985 203,439,893 178,567,489 158,377,714 141,673,962
4.50% 486,093,414 379,888,246 309,414,903 259,275,056 221,805,840 192,764,392 169,611,415 150,734,182
5.00% 553,116,924 420,100,401 335,899,477 277,850,892 235,439,234 203,119,480 177,690,634 157,175,526
Sensitivity Analysis(Equity Value)
WACC
TerminalGrowth
8.5% 9.5% 10.5% 11.5% 12.5% 13.5% 14.5% 15.5%
2.00% -16.6%
2.50% -12.4%
3.00% -7.7%
3.71% 74.2% 40.8% 17.4% 0.0% -13.4% -24.0% -32.6% -39.7%
4.50% 10.4%
5.00% 18.3%
Sensitive to Terminal growth rate
WACC & Terminal Growth Grid

55. Sensitive to Terminal growth rate
Sensitivity Analysis(Equity Value)
WACCR&D/Sales
234,808,092.0 8.5% 9.5% 10.5% 11.5% 12.5% 13.5% 14.5% 15.5%
8.00% 336,798,717 270,695,252 224,286,946 189,949,396 163,542,729 142,625,117 125,663,173 111,645,459
7.00% 360,846,003 290,663,779 241,379,124 204,902,592 176,841,784 154,605,908 136,568,020 121,654,960
6.00% 384,893,289 310,632,305 258,471,302 219,855,789 190,140,838 166,586,698 147,472,867 131,664,461
5.00% 408,940,574 330,600,832 275,563,480 234,808,985 203,439,893 178,567,489 158,377,714 141,673,962
4.00% 432,987,860 350,569,359 292,655,658 249,762,181 216,738,948 190,548,280 169,282,561 151,683,464
3.00% 457,035,146 370,537,885 309,747,836 264,715,377 230,038,002 202,529,070 180,187,408 161,692,965
Sensitivity Analysis(Equity Value)
WACC
R&D/Sales
8.5% 9.5% 10.5% 11.5% 12.5% 13.5% 14.5% 15.5%
8.00% -19.1%
7.00% -12.7%
6.00% -6.4%
5.00% 74.2% 40.8% 17.4% 0.0% -13.4% -24.0% -32.6% -39.7%
4.00% 6.4%
3.00% 12.7%
Techlando Sensitivity Analysis
WACC & R&D on sales Grid

56. NPV- Monte Carlo Simulation (New Line)
Sales
COGS
R&D
SG&A
DSO
DIH
Interest Rate
NWC
99% Probability to take the new
Product

57. IRR- Monte Carlo Simulation (New Line)
99% Probability that IRR> Cost of
Capital (11.46%) Sales
COGS
R&D
SG&A
DSO
DIH
Interest Rate
NWC

58. SHARE PRICE PER- Monte Carlo Simulation
81% Probability that of Fair Value
to Be Greater than $ 25 Sales
COGS
R&D
SG&A
DSO
DIH
Interest Rate
NWC

59. CAPITAL GAIN- Monte Carlo Simulation
74% Probability to take there would
be capital gain greater than 100% Sales
COGS
R&D
SG&A
DSO
DIH
Interest Rate
NWC

60. FOR CURRENT BOARD OF DIRECTORS
11%
Equity dilution
231%
Capital gain

61. RISK & MANAGEMENT

62. OTHER ISSUES – Industry Competition & Product Management
How Would Techlando Deal with the Competitive Environment & Product Offerings ?
Sales
Growth % Current New Line
Proposed Strategy-
Product

63. At early 2022,Techlando will Have to focus of R&D focusing the followings:
AI inclusion in hardware
Internet of things (IoT) based products
Investing on Tech Base Incubator Programs
Customize service based on customer orders
Sales will decline from 2022
OTHER ISSUES – Industry Competition & Product Management
How Would Techlando Deal with the Competitive Environment & Product Offerings ?
Collaboration With Firms engaged in Only R&D

64. OTHER ISSUES – Industry Competition & Product Management
How Would Techlando Deal with the Competitive Environment & Product Offerings ?
GTM- GO-to-Market Strategy……
R&D
Investment Slow Skimming
• Connect with Right
Partners
• Set-up test for Buyers
• Price- Value Based
• Stock Limit
Profit Max.
• Support Services
• Distribution Channels
• Marketing Message
Product Awareness
Market Modification-
End Based Customer
Product Modification
Reduce Promotion
Price Cuts

65. RISK MATRIXHigh
Financial Risk
Probability
LowMedium
Low Medium High
Operational
& Business Risk
Market Risk
OP1
IMPACT
OP2
OP3
OP1: Product Obsoletion after 3 years (New Product
by Competitors
OP3: Inventory Write-down from low sales
Mitigation: Recovery of Investment and investment in
R&D for Product modification
OP2: Increase in Working Capital Needs
Mitigation: Excess Funding Can be meet from Notes
payable margin not used
Mitigation: Modifying products & targeting Specific
Client group to give an end to end solution to needs

66. RISK MATRIXHigh
Financial Risk
Probability
LowMedium
Low Medium High
Operational
& Business Risk
Market Risk
F1
IMPACT
F2
F3 F1: Increase in Financial Leverage
Mitigation: ensuring 25% on average debt of book
value that would reduce financial distress
F2: Increase In interest Rates
Mitigation: Fixed rate 4.73% 10-year bond issue with
written consent in Bond Indenture
F3: Redeeming of Bonds
Mitigation: Callable Bond Issue with singing fund
provision

67. RISK MATRIX
High
Financial Risk
Probability
LowMedium
Low Medium High
Operational
& Business Risk
Market Risk
M1
IMPACT
M2
M1: Increasing Competition from new entrance
Mitigation: Unlikely that as already established and
Tehlandoe’s R&D as well as threshold resources will make it
difficult for new firm to compete in the market
M2: Technological Changes
Mitigation: Efficient Spending for R&D, and ensuring the
retention of a strong skilled group of research technicians
and scientist also ensuring co-operation with Firm engaged in
research

68. Key success Factor
High demand
for 80%
revenue
generating
segment
Revenue
growth
compared to
industry overall
growth
Launching new
Products which
that has
market
demand
(Trend)
High R&D
investment to
grab growth
Skillful
technicians
and scientists
with updated
knowledge
and skills
High quality
product with
increased
customer
acceptance

69. The Industry is at its Rapid Growth and its the Right time to Invest on capitalizing
the opportunities arising from this Growth (48.16% market Upside Potential)
FIVE REASONS TO INVEST ON GROWTH
Or How investment will create value for Techlando ?
Techlando’s Strength Composition is Suitable for the investment Opportunity
The Investment would Ensure Techlando’s Survival in the upcoming years in the
highly Competitive Environment
A New Product Line will have NPV $4.91 mm, with IRR of 21%
231% Gain or 2.31x extension of equity for Current BOD

70. Thank you!
Any question?
TEAM FINCAST