how to calculate fixed asset investment & net debt from financial statement

hi all, I want to calculate FCFF for a company (leading Indian auto maker Maruti Suzuki). For this I require investment in fixed asset that is PPE investment or capital expenditure for a year. I am available with me company financial statement but not able to find out investment in fixed asset as it is not given under “Cash flow from investment section”. As you all know financial statement vary from one country to another. Could some one please help me how to calculate this item from seeing company financial statements. For your reference I am given the link from where you can see company financial statement for 2009-10. Please some1 just describe the steps how to calculate investment in fixed asset from statements. Also I need to calculate net debt value to get WACC for DCF valuation. Could some1 also please help me to find out net debt value from these financial statement. Thanks in advance and waiting for reply

Fixed Asset investment is directly provided to you on the Balance sheet look at the section reading Application of Funds Gross Block Accumulated Depreciation below that there is Investment… a line item on the Balance sheet. For Debt You have Loan Funds, Deferred Tax (Sources of Funds) and in the Asset (Sundry Debtors, Current Liabilities). You might want to use a US GAAP balance sheet - if you are studying for the Level II exam (Since there are vast variances between that and an Indian company’s balance sheet and income statements) - though I suspect you are a troll out here trying to get your college / class assignments done by posting on this board.

@cpk123 thanks for replying me. I have fair understanding of US GAAP balance sheet standard but as you also mentioned Indian statement is quite different from US GAAP. I was trying to calculate FCFF for company to estimate fair value for company stock. one thing you mentioned that investment in fixed asset is given under Investment item in balance sheet. I just looked at it and found from schedules that this figure is different from what I was trying to get. Investment items is covering company investments in trade investment, Mutual funds and other items. But I want to calculate company investment for a year in property,plant and equipment which are needed to calculate Free cash flow. so if some 1 can answer me how to figure out this item from company statement and as I mentioned Indian statement is different from US GAAP because I have seen in some US company statement this figure is directly given in balance sheet which is not the case here. thanks

I did not mean “investment in fixed asset is given under Investment item in balance sheet” – if you looked at the balance sheet - under fixed assets - there is a line item saying “Investment” - see if that figure matches.

Investment item figure is completely different from what I was trying to ask you and as I mentioned its consist of amount invested in Mutual funds, trade investment etc when I saw schedule for Investment section. I want to know investment in PPE items means property,plants& equipment but not able to find out this amount. Could you please just look at company balance sheet once and schedule and help me to figure out this thing. This would be really helpful for me a lot ! Thanks

and you do not look at the cash flow statement at all? Purchase of Fixed Assets (13,597) (16,207) Sale of Fixed Assets 448 71 which also matches what is in the Schedule 5 (if you exclude the Land, etc.)

I saw that figure and even estimated that as invetsment in PPE. But I was not sure that should I include investment on land to calculate free cash flow for firm. so you say investment in land is excluded while calculating FCFF, right? just answer me this and thanks for all your help you know I saw some research report for same company and every research report has given some different figure for capital expenditure amount to calculate FCFF which made me even more confused :slight_smile:

I tried to calculate this value using schedule 5 but still not getting correct figure what mentioned in cash flow statements in investment section under fixed asset (13597). Below are items under schedule 5: Items as t 1.04.09 addition adjustment Building 6,340 920 (29) Plant and Machinery (Note 2) 76,580 11,107 (981) Electronic Data Processing Equipment 1,344 114 (231) Furniture , Fixtures and Office Appliances 566 131 (7) Vehicles: - Owned 529 220 (222) - Leased 3 - (3) Intangible Assets - Lump Sum Royalty - 194 - Now please tell me do we need to left out any items out of these except land which I already excluded. what we need to exclude further more. and what about deductions adjustment, what to do with those figures. plz tell me and thanks for your help