Premium Hibiscus Business Plan — Investment Case and Returns

The return profile, valuation basis and exit assumptions, and what the numbers do and do not support.

Section 21 of 25

Investment Case and Returns

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On a 5.5x Year-5 EBITDA exit, the base case returns roughly 3.1x MOIC and a ~29% equity IRR. These are growth-stage returns — earned through a real J-curve and sensitive to the exit multiple, FX and execution.

Figure 1. Returns bridge — exit enterprise value to equity value and MOIC (base case)

Returns summary

Metric	Base case
Total equity invested (USD ‘000)	6,000
Year-5 EBITDA (USD ‘000)	3,610
Exit EV/EBITDA multiple	5.50x
Exit enterprise value (USD ‘000)	19,855
Less: net debt at exit (USD ‘000)	(1,320)
Equity value at exit (USD ‘000)	18,535
MOIC	3.09x
Equity IRR	29%

Table 24. Base-case equity returns on a trade-sale exit.

Valuation triangulation

A discounted-cash-flow cross-check at a 15% USD WACC, appropriate for frontier agribusiness, yields an enterprise value of about USD 4.7m, materially below the exit-multiple valuation. This divergence is an honest and important signal: at a 15% discount rate the intrinsic value is modest and heavily terminal-dependent, because the venture consumes cash through Year 3 before free cash flow turns positive. The equity return is therefore a growth-and-execution return, not a deep-value entry. A lower discount rate (patient or concessional capital) or a strategic-buyer premium at exit lifts the intrinsic value; a compression of frontier multiples reduces it.