Discounted cash flow valuation of president bakery public company limited.

Abstract

This thematic paper demonstrated how to value the stock price of President Bakery Public Company Limited (PB) which applied the concept of discounted cash flow to firm model, creating a forecast and calculating a reasonable valuation of the firm’s share price and at the end making a recommendation whether to buy/hold/sell the company’s stock. President Bakery (PB) is a leading baked goods company in Thailand such as ready-to eat bread, ready-to eat sandwiches, cakes and confectionaries, with a 26% market share which is the highest market share in year 2017. Moreover, the company had invested in the new factory which was “Bangchan 2” and started the operation in November 2017 which will increase the production capacity about 20%. The new investment is expected to deliver a better earning for the company as well as to increase the level of market share of the company. The result from this paper shows the value of PB share price is expected to be valued at 6% higher than the current share price. However, the ability to gain back market share and cost control is still unclear. This result lead to my recommendation of “hold”.