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What is the expected growth rate of the company

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Reference no: EM132824093

Question - Theta PLC has reported earnings per share (EPS) of Rs.10.00 for the prior period. Company adopts 80% dividend payout policy. It is expected that the future EPS and the dividend per share will grow at a constant growth rate which derives from retention and industry average return on investment. Return on investment of the industry is 25%.

Required -

i. What is the expected growth rate of the company?

ii. If the investors required rate of return is 15%, what is the value of the share?

iii. If the shares of Theta PLC currently traded at Rs.68 per share, what is your recommendation for the investors.

Reference no: EM132824093

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