Equity Shares Valuation Illustration 19


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Sukhada Ltd. paid  2.50 as dividend per share on its equity shares for the last year. Dividends are expected to grow at 10 per cent per year for an indefinite future. (a) What is its expected rate of return if its current market price is  20? (b) If the required rate of return is 12%, what would be the value of stock? (c) Is it worth investing in the share?


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