Black Box — DCF Valuation
Every assumption explained. Adjust the model to see how the answer changes.
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Sign inHistorical free cash flow
The real input to the DCF model. Free cash flow = operating cash flow minus capital expenditure. The most recent year is used as the starting point for the 5-year projection.
| Year | Free Cash Flow | Operating CF |
|---|---|---|
| FY22 | ₹44 Cr | ₹95 Cr |
| FY23 | ₹-81 Cr | ₹18 Cr |
| FY24 | ₹89 Cr | ₹140 Cr |
| FY25 | ₹-132 Cr | ₹-88 Cr |
| FY26 | ₹12 Cr | ₹84 Cr |
Assumptions used
Based on the company's recent revenue trend, tapering toward the terminal rate. For cyclical companies, the average of 3-year and 5-year CAGRs is used to smooth cycle effects.
The required rate of return — what you could earn elsewhere at similar risk. A higher WACC reflects more business risk and significantly reduces today's value of future cash flows. Moving this by 1pp typically shifts the output 20–30%.
The growth rate assumed to continue forever after year 5 — typically near India's long-run GDP growth rate. Terminal value usually accounts for 60–80% of the total DCF value, so this single assumption matters enormously.
Cash flows are explicitly projected for 5 years. A terminal value captures all growth beyond that point. The 5-year horizon limits exposure to compounding forecast error.
Adjust the model
Change any assumption to see how the intrinsic value shifts. This shows you why DCF results are always a range, not a single precise number.
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Sign inReverse DCF
What growth rate is the market already paying for?
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Sign inDCF limitations
DCF is highly sensitive to assumptions. Moving the discount rate by 1pp typically changes the output by 20–30%. Moving terminal growth by 0.5pp can shift it 10–15%. Small errors in assumptions compound significantly over a 5-year horizon. Treat the output as a range, not a precise target — and use peer comparison as a sanity check.
Read our plain-English guide to how DCF analysis works and what each assumption means.
The intrinsic value shown is an algorithmic estimate based on publicly available financial data. It is not investment advice or a recommendation to buy, sell, or hold any security. Please consult a SEBI-registered investment adviser before making any investment decision.