What is a DCF Calculator?
DCF valuation estimates what future free cash flows are worth today. It is powerful precisely because the assumptions are explicit — and dangerous when a single optimistic growth or terminal-value assumption is treated as fact.
Enter a starting free cash flow, forecast growth, discount rate, terminal growth, debt before separately modelled cash, cash and shares outstanding. Finpockett shows the forecast period, terminal value and the resulting equity value per share.
Discounted cash flow methodology
The discount rate must be above the terminal growth rate. In this calculator the debt field means debt before the separate cash input: equity value = enterprise value − debt + cash. If your figure is already net debt (debt minus cash), enter that net-debt figure in the debt field and set the separate cash input to ₹0 so cash is not added twice.
Worked example: ₹100 crore starting FCF
Assume starting free cash flow of ₹100 crore, 10% annual growth for five years, 12% WACC and 4% terminal growth. Forecast FCF is about ₹110.0, ₹121.0, ₹133.1, ₹146.4 and ₹161.1 crore. The present value of those five forecast cash flows is about ₹473.8 crore.
The terminal value is about ₹2,093.7 crore; discounted back five years, its present value is about ₹1,188.0 crore. That is roughly 71.5% of the resulting enterprise value of about ₹1,661.8 crore, illustrating why terminal assumptions can dominate a DCF.
Using ₹200 crore of debt before cash, ₹50 crore of separately modelled cash and 10 crore shares gives equity value of about ₹1,511.8 crore, or approximately ₹151.2 per share. If the ₹200 crore figure were already net debt, cash should be set to ₹0 instead.
Terminal value can dominate the answer
If most of enterprise value comes from terminal value, the model is effectively making a very long-range assumption. Always inspect the sensitivity matrix rather than quoting a single intrinsic-value number.
Use internally consistent cash flow and discount rate
Enterprise free cash flow should be discounted at a rate appropriate to the operating cash flows. Mixing equity cash flow, enterprise cash flow and discount rates can produce a mathematically tidy but economically inconsistent valuation.
Frequently asked questions
Is DCF an investment recommendation?
No. It is an assumption-driven valuation framework.
Why must WACC exceed terminal growth?
The perpetuity-growth formula becomes undefined or economically implausible when long-run growth equals or exceeds the discount rate.
Why is the sensitivity matrix mandatory?
Small changes in discount and terminal growth rates can materially change the valuation, so a single-point result can create false precision.
What does the debt input mean?
It means debt before any cash entered separately. The calculator uses equity value = enterprise value − debt + cash. If your figure is already net debt, enter it in the debt field and set separate cash to ₹0.