Rockwool International A/S: Strategisk analyse - værdiansættelse

Adam Brødsgaard

Student thesis: Diploma thesis

Abstract

The purpose of this thesis is to complete an analysis and valuation of the Danish insulation company Rockwool International A/S and to reach a conclusion on whether the official closing stock price of a Rockwool International A/S B-stock is over- or underestimated in comparison with the estimated closing stock price calculated in this paper. Rockwool International A/S is the largest stone wool insulation manufacture in the world with a turnover of DKK 11.168 in 2009. An internal analysis has been performed in order to unveil Rockwool International A/S' internal strengths and weaknesses. The analysis showed that Rockwool has a strong competitive advantage due to the innovative System Divisions-department and especially their advisory department BuildDesk that provide customers with knowledge and guidance, a service that many of the biggest competitors do not offer. The external environment has been analyzed through a PEST and Porters 5 forces analysis. Here it was concluded that the insulation market has experienced a fall in the demand for insulation due to the financial crises but yet showed possibilities for energy-efficient insulation due to the current and future regulations on global warming. The competitive intensity of the insulation industry has been identified as being medium as a result of few but large competitors combined with the threat of a slower growing marked. The financial analysis showed that Rockwool had high growth in their turnover from 2005 to 2007 but from 2007 to 2009 Rockwool's turnover dropped by approximately 25 %. The analysis also showed that a large majority of Rockwool's turnover was generated by Rockwool's core activity. The findings in the strategic and financial analyses served as basis for the future budget prepared in order to estimate the value of the future free cash flow and the weighted average cost of capital which was needed in order to calculate the estimated closing stock price. The market value of Rockwool International A/S's net capital was estimated to 9.723 Mio. DKK., which is the equivalent to a closing stock price of 443, 98 DKK. This means that the overall conclusion on this thesis is that the official closing stock price of Rockwool International A/S B-stock is overestimated by 91, 02 DKK, or 20, 50 %.

EducationsGraduate Diploma in Financial and Management Accounting, (Diploma Programme) Final Thesis
LanguageDanish
Publication date2010
Number of pages116