Raj Finance Private Limited issued convertible debentures at a coupon rate of 11%. Each debenture has an option to convert 16 equi

Raj Finance Private Limited issued convertible debentures at a coupon rate of 11%. Each debenture has an option to convert 16 equity shares at any time until the date of maturity. Debentures will be redeemed at Rs. 100 on maturity of 5 years. An investor generally requires a rate of return @ 8% p.a. on a security of 5 years. As a financial advisor when will you advise the investor to exercise the conversion at given market prices of equity shares of (i) Rs.5 (ii). Rs. 6 and (iii). Rs. 7.10. 1. Cumulative PV factor for 8% for 5 years is 3.993.
2. PV factor for % for 5 years is 0.681.