1801.HK
INNOVENT BIOClosed1801.HK discounted cash flow valuation
1801.HK Fair Value
Reverse DCF: today's price implies -5.7% a year of FCF growth for years 1–5, against 25.0% in this model.
Model: 25.0% from analyst next-year EPS & revenue growth (capped). Fades linearly to terminal growth by year 10.
Model: 7.67% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | HKD 225.48B |
|---|---|
| PV of terminal value (71% of EV) | HKD 539.48B |
| Enterprise value | HKD 764.96B |
| + Cash & investments | HKD 23.45B |
| − Total debt | −HKD 2.72B |
| Equity value | HKD 785.68B |
| ÷ Shares outstanding | 1.74B |
| Value per share | HKD 450.54 |
| Market cap | HKD 153.46B |
CNY statements converted at 1.172 HKD.
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.22% |
|---|---|
| Beta (clamped 0.5–2.5) | 0.50 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 7.72% |
| Pre-tax cost of debt | 5.22% |
| Tax rate | 3.0% |
| Debt / (equity + debt) | 1.7% |
| WACC | 7.67% |
Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.67% | 601.67 | 672.59 | 765.88 | 894.09 | 1,081.35 |
| 6.67% | 474.91 | 517.36 | 569.98 | 636.92 | 724.97 |
| 7.67% | 389.83 | 417.51 | 450.54 | 490.63 | 540.33 |
| 8.67% | 328.97 | 348.11 | 370.36 | 396.52 | 427.73 |
| 9.67% | 283.39 | 297.22 | 312.96 | 331.07 | 352.10 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (FY2025) | — | HKD 10.92B | — | — |
| Year 1 | 25.0% | HKD 13.65B | 0.929 | HKD 12.68B |
| Year 2 | 25.0% | HKD 17.07B | 0.863 | HKD 14.72B |
| Year 3 | 25.0% | HKD 21.33B | 0.801 | HKD 17.09B |
| Year 4 | 25.0% | HKD 26.67B | 0.744 | HKD 19.84B |
| Year 5 | 25.0% | HKD 33.33B | 0.691 | HKD 23.04B |
| Year 6 | 20.5% | HKD 40.17B | 0.642 | HKD 25.78B |
| Year 7 | 16.0% | HKD 46.59B | 0.596 | HKD 27.77B |
| Year 8 | 11.5% | HKD 51.95B | 0.554 | HKD 28.76B |
| Year 9 | 7.0% | HKD 55.59B | 0.514 | HKD 28.58B |
| Year 10 | 2.5% | HKD 56.98B | 0.478 | HKD 27.21B |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else the average of next year's EPS and revenue growth, else revenue CAGR, held between −5% and 25%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.