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FUNDAMENTAL

Discounted Cash Flow (DCF) Calculator

The Discounted Cash Flow (DCF) model estimates the intrinsic fundamental value of a business by projecting its future Free Cash Flows (FCF) and discounting them back to the present day using the Weighted Average Cost of Capital (WACC).

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Input Parameters
Click Calculate when ready
e.g. Rs 1,00,00,000
Rs
%
%
%
e.g. Rs 1,00,00,000
Rs
e.g. 10,00,000 shares
Calculation Results
Enter your values and click Calculate.

Provide the input parameters on the left to compute the official financial result and metrics.

DECISION MODELINGSENSITIVITY ANALYSIS

Sensitivity Analysis

Evaluate how variations in key operational drivers impact Intrinsic Value Per Share.

Vary the 5-year compound annual growth rate of projected free cash flows.
Calculate the base model above to view scenario sensitivity rows.

Formula & Methodology

Intrinsic Value = Present Value of 5-Yr Cash Flows + Present Value of Terminal Value
FCF_0
Base Year Free Cash Flow

Operating Cash Flow minus Capital Expenditures.

g
5-Year FCF Growth Rate (%)

Projected annual growth of free cash flow.

r
Discount Rate (WACC %)

Required hurdle rate / cost of capital.

g_term
Perpetual Terminal Growth Rate (%)

Long-term economic GDP growth rate (typically 2-3%).

Practical Worked Example

Apex Tech produces Rs 1,00,00,000 in base FCF, growing at 15% for 5 years with a 10% discount rate, 3% terminal growth, Rs 1,00,00,000 net debt, and 10,00,000 shares.

01.5-Year Discounted FCFs = Rs 5,55,38,000.
02.Terminal Value discounted to PV = Rs 18,28,40,000.
03.Enterprise Value = Rs 23,83,78,000.
04.Equity Value = Rs 23,83,78,000 − Rs 1,00,00,000 = Rs 22,83,78,000.
05.Intrinsic Value Per Share = Rs 228.38.
Rs 228.38 Per ShareIf the stock trades below Rs 228.38, it offers an attractive valuation margin of safety.

Interpretation & Industry Benchmarks

DCF is the fundamental cornerstone of institutional valuation on Wall Street and Dalal Street.

Market Price < DCF ValueUndervalued

Stock trades below intrinsic discounted cash flows.

Industry Nuance: Terminal value typically constitutes 65%–80% of total DCF enterprise value.

Analytical Limitations

  • Sensitive to small changes in discount rate and terminal growth assumptions.

Frequently Asked Questions

What is Free Cash Flow (FCF)?

Operating Cash Flow minus Capital Expenditures (CapEx). It is the cash available for distribution to debt and equity holders.

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Disclaimer: For educational and analytical modeling purposes only. Does not constitute financial or investment advice.