Valuation based on shareholders’ rate of return earned from a listed company is given below Company A Dividend/Share just paid =12cents Historical

=12cents

Historical dividend growth rate =5%/year , this is expected to be mantained into the future

Statistics of a suitable listed company (same business and same gearing), Share price $2.40

Dividend just paid 22c

Company B

Historical growth rate =10%/year. This is expected to be mantained in the future

Company B is unlisted and want to know the valuation of the business for strategic planning purposes.

Calculate the share value of the Unlisted company B which operates in the same industry with company A. Show all workings