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ONLY FOCUS ON FCFE AND DDM Project Description: REIT INDUSTRY , STARTHILL GLOBAL Stock code: P40U.SI http://www.marketwatch.com/investing/stock/sglmf/financials Do a small analysis on FCFE and DDM and explain your results, do a forecast until year 2018 EXCEL SHEET 1 and 2 are done, values just need to be checked again to reconfirm Sheet 3 some of the values are wrong sheet 4: totally untouched all the values are not correct sheet 5: some values are wrong OBJECTIVE OF THIS PROJECT: TAKING 7 AUGUST 2013, STARHILL GLOBAL CURRENT PRICE OF $, OUR ROLE IS TO DETERMINE AND FORECAST A 12 MONTH PRICE TARGET FOR STARHILL GLOBAL. WHY DO A VALUATION PROJECT. • BEING ABLE TO VALUE SOMETHING (A FINANCIAL ASSET IN THIS CASE) IS AN IMPORTANT SKILL SET. • THE PROJECT WOULD TAKE YOU THOROUGH THOUGHT PROCESS TO SHARPEN YUR ANALYTICAL (BOTH QUANTITATIVE AND QUALITATIVE) AND FORECASTING SKILLS. • MOST IMPORTANTLY, A VALUATION PROJECT IS NOT JUST A NUMBER CRUNCHING EXERCISE! • GIVE AN INDUSTRY OVERVIEW AND IDENTIFY THE KEY DRIERS SPECIFIC TO THE INDUSTRY N GIVE AN OVERVIEW OF THE FIRM’S BUSINESS LINES AND ITS CHARACTERISTICS -10% • 1) ESTIMATE BETA USING 60 HISTORICAL MONTHLY DATA POINTS FOLLOWED BYBETA ADJUSTMENT 2) ESTIMATE EXPECTED MARKET (STI) RETURNS IN 2013 3) PICK RISK FREE RATE 4) ESTIMATE REQUIRED RATE OF RETURN: 6.25% or 0.0625 • PERFROM A 3 STEP DUPONT ANALYSIS ON THE FIRM AND COMPARE IT WITH ITS PEERS – 10% • FROM THE ANALYSIS OF THE ECONOMY, INDUSTRY IDENTIFY THE KEY DRIVERS (BOTH POSITIVE AND NEGATIVE) THAT WILL HAVE AN IMPACT ON THE FIRM WITH REGRADS TO: -10% 1) FUTURE REVENUE/ SALES (IF APPLICABLE) 2) FUTURE EXPENSES (IF APPLCABLE) 3) CAPEX (IF ANY) 1) FUTURE GROWTH RATE, HENCE 2) FUTURE EARNING, HENCE HENCE: 1) AFFECTING THE RISKNESS OF THE STOCKRECALIBRATE BETA), 2) AFFECTING FUTURE DIVIDENDS PAYOUT • USING CASH FLOW VALUATION TECHNIQUES. -20% 1) USE DDM TO ESTIMATE THE 12 MONTH PRICE TARGET 2) USE FCFE TO ESTIMATE THE 12 MONTH PRICE TARGET