Intrinsic Value Calculation for Tech Innovations Inc.

XYZ Holdings is an investment firm looking to evaluate the intrinsic value of a potential acquisition target, Tech Innovations Inc. The firm has gathered the following financial information:

- Tech Innovations has a current book value of equity of $4 million.

- Projected net income for the next year is $800,000.

- The firm’s cost of equity is estimated to be 10%.

- Tech Innovations has consistently exhibited a growth rate of residual income at 5% per year for the next five years.

Using the Residual Income Valuation method, what is the estimated intrinsic value of the equity of Tech Innovations Inc.?