ABC Ventures is private equity investor considering investing Rs. 1,000 million in the equity of XYZ ltd. ABC Ventures requires a return of 30% on investment with planned holding period of 5 years. The likely debt of XYZ ltd. will be Rs. 1000 million and cash balance of Rs. 300 million with a projected EBITDA of Rs. 1500 million for the year 5. The desired ownership share of ABC Ventures in XYZ ltd., given FVF0.30,5 = 3.713, will be:
1
37.13%
2
30.00%
3
37.90%
4
7.13%