Ann: Research Coverage Initiated, page-3

Valuation
DCF valuation
Our estimated DCF-derived equity value for BUD of A$438m - equivalent to A$31c per fully diluted share – is predicated on the following assumptions:
 Explicit cash flow forecasts over the five-year forecast period FY17E-FY21E),
 Two-stage revenue growth after FY21E:
o Relatively high revenue growth of 15%pa over the five-year period FY22E-FY26E,
o Terminal revenue growth of 5%pa (1/3 high growth rate).
 Two-stage EBITDA margin after FY21E:
o Relatively high EBITDA margin of 40% (equal to FY21E) over the five-year period FY22E-FY26E,
o Terminal EBITDA margin of 20%pa (1/2 high margin).
 A discount rate of 10%,
 1,425 million fully diluted number of shares, derived from existing 1,020 million fully diluted shares plus a forecast 405m new shares issued to purchase Noveda Technologies (i.e., consideration of US$24m (A$32m @ US$0.75) and BUD’s current share price of A$8c).

Nice, DCF of $0.31 for BUD by State One.