strategic viewpoint on IVC, page-8

Using a de-rated PE of 15:
Using Commsec Estimated EPS:
FY18: EPS of 55.6c on a PE of 15 gives a share price of $8.34
FY20: EPS of 61.3 on a PE of 15 gives a share price of $9.20

Using fair value on Return on Equity:
10yr high ROE of 45% low ROE of 20%
For analysis give benefit of the doubt and use the high: 45%

Current book value is now only around $1.52 (look at the latest half year report, net assets have dropped massively from $282m to just $167m, so there will be massive drop in book value).

Using $1.52 @ 45% ROE at 10% RRR = 1.52x 4.5 = $6.84 (and this is with IVC decade high ROE, average ROE is around 30%).

Under all these circumstances current share price is significantly higher than fair valuation.

Remember as well that all this capital expenditure going on will hit the P&L in future years as higher depreciation expense.

So again, its a clear sell.