Financial Analysis Of A New Project - 1338 Words

Financial analysis of a new project Introduction The following paper analyzes a project from financial perspectives using the capital budgeting techniques like Net Present Value (NPV) and Internal Rate of Return (IRR). Background My dad has a textile business, involved in embroidery and painting of the fabric. I have been visiting my dad’s office complex and observing the whole process of clothes manufacture. The most important asset for the business is a large machine required for whole painting process. The existing machine with the business is in use from past 4 years and has to be discarded due to some operational issues. As a student of finance, I will analyze the option of replacing this machine with a new one. In analyzing various options from where to purchase the machine, I searched for various dealers, and compared the products with the prices they offered. I narrowed down the choice to one machine provided by Stihl Machinery Co., Ltd. But then dad’s financial manager, Mr. David Jones, asked me to reconsider the option. He suggested that the existing machine can still run for another 5 years and the new machine is also expected to work for just five years. Also, the price of the new ma chine is quite high so it is better to continue using the same old machine. On this argument, I decided to do a detailed analysis of the option to replace the old machine. Only after the financial analysis, I will decide and suggest whether to buy the new machine or not. Analysis andShow MoreRelatedSports Direct Financial Situation Analysis and Their New Project Investment in Morocco5386 Words   |  22 PagesPART I: COMPANY ANALYSIS 5 1- Introduction of the company 5 1.1 History: 5 1.2. The industry: 5 1.3. Sports Direct today: 6 2. Analysis on the financing structure of the company 6 2.1. Sports Direct financial statements: 7 2.2. JJB Sports financial statements: 9 2.3. Ratios of Sports Direct and JJB Sports 12 3. The weighted average cost of capital 15 3.1. Cost of equity: 15 3.2. Cost of debt: 15 3.3. WACC: 16 PART II: PROJECT INVESTMENT ANALYSIS 17 1- PreliminaryRead MoreIndia Bulls,1072 Words   |  5 PagesVidyapeeth Deemed University â€Å"FINANCIAL ANALYSIS: A COMPARATIVE STUDY OF INDIABULLS HOUSING FINANCE LTD.† A SUMMER TRAINING PROJECT REPORT SUBMITTED IN PARTIAL FULLFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF DEGREE OF MBA 2O11-13 SUBMITTED BY GUIDED BY CHETAN SAPRA MS. SONALI MBA (FINANCE amp; MARKETING) DHARAMADHIKARI ROLL NO. 30 CERTIFICATE OF ORIGINALITY This is to certify that the project report entitled â€Å"FINANCIAL ANALYSIS: A COMAPRATIVE STUDY OF INDIABULLSRead MoreApplication Of Management Accounting Theories Essay1541 Words   |  7 Pagesinvestment appraisal and variance analysis which are used to make the decision and estimation. 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How do incremental cash flows differ from total project cash flows? What is the difference between foreign project cash flows and parent cash flows? How does APV analysis differ from NPV analysis? How is the capital budgeting analysis adjusted for the additional economic and political risks? What is real option analysis? ComplexitiesRead MoreOutsourcing1547 Words   |  7 Pageslanguage and professional train for the last ten years. Its project to get up its China branch in Shanghai, the biggest city and economical centre of China, would prove a good choice. The purpose of this essay is to assess the financial viability of the proposed project by financial benefit-cost analysis. Cost-benefit analysis is typically used by companies or government to evaluate the desirability of a given intervention. It is an analysis of the cost effectiveness of different alternatives in order