ZIO is a small-to-medium-sized privately held company specializing in electrical equipment manufacturing and is seeking additional investors. Below…

ZIO is a small-to-medium-sized privately held company specializing in electrical equipment manufacturing and is seeking additional investors. Below are key financial indicators to assist in evaluating the investment potential: Break-even Achieved: The Company has reached its break-even point this year.EBITDA:110 Lakh, including an extraordinary gain of 16 Lakh.Pending Adjustments:38 Lakh in preliminary sales promotion costs are yet to be written off.Unlevered Beta: 1.5 (based on the industry benchmark).Capital Structure: Debt-to-Equity Ratio of 30:70.Risk-Free Rate: 6% (based on liquid bonds).Market Rate of Return: 12% (internal industry assessment).Equity Value (EV): The EV is to be taken at a multiple of 8 on EBITDA.The pre-tax cost of debt is 12.45% and assume a tax regime of 30%. The Future Cash Flows (FCFs) for the next three years are as follows: Year 1 Year 2 Year 3 Future cash flows (₹ in Lakh) 150 200 220 Future cash flows are discounted at Weighted Average Cost of Capital (WACC) PV Factor at 15% & 14% are as under - 1 2 3 PV Factor at 15% 0.870 0.756 0.658 PV Factor at 14% 0.877 0.769 0.675 Calculation upto 2 decimal places. You are required to calculate potential value to be placed on ZIO Company.