Project Appraisal and Financing

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Meaning and Objective

Before undertaking any activity every entrepreneur has to first make a project report whether his project is self-financed or is being financed by a bank or a financial institution. This needs to be a detailed analysis. It has to be a very scientific research oriented endeavor. It is suggested that one must take the help of an expert in this. It is not only our suggestion but it is our recommendation. Project report must be made with an objective that the appraisal of the project and its financing becomes easy and smooth. Project appraisal is the assessment of the project by the concerned appraising authority in terms of its technical, economic, financial and social viability. Every lending financial institution before lending any assistance in the form of finance would like to make an objective assessment of the various propositions of the project.  And only when it is completely satisfied of the fact that the project is economically viable and socially acceptable, it will lend finance to the project. 

Industry and Market Analysis

The project appraisal report should highlight the detailed industry and market analysis. It must indicate the strength of the products being manufactured by the company. What kind of technology the company is implementing? What is the industry position? Is it a growing and sun rising industry? Are the products and technology being adopted is competitive? Is the technology being adopted is a green technology and is upgradeable? Is there a scope for further growth? Are there growth opportunities available? Is the project scalable and are there scalable opportunities in the future? Is the project economically and commercially sustainable for a longer period of time? Is there a proper allocation of resources? What is the status on demand and supply analysis? What about the identification of the target market and choice of the marketing strategy? Is there a technical analysis of selection of the appropriate technology and acquisition of technology? What is the process of procurement of raw materials? What is the process of manufacturing and value addition? Is there a design and layout of the facilities of the project site? What is the choice of location of the project? What about the environmental appraisal of the project?  The project must give the details of the financial projection on: (a) The cost of the project, (b) The means of finance, (c) Estimation of working capital, (d) Profitability projections and estimations, (e) Balance Sheet projections, (f) Projection of sources and uses of funds, (g) Social Cost Benefit Analysis. What is the outlook of the business for at least 20 years from now?    

nd Finance Objective The objective of the course is to ideas Detailed An Overview of Project Finance: Introduction to project finance and overview of the project finance market, A of a Proper Allocation of Resources, Process of Resource Allocation at the Corporate Level, Process of Resource Market And Demand Analysis: Identification of the Target market, choice of the Market Strategy, Projection Models. Technical Analysis: Selection of Appropriate Technology, Acquisition of Technology, Process of Procurement of Materials, Choice of a Good Location for the Project, Design of the Layout of the Facilities at the Project Site. Financial projections: The Cost of the Project, The Means of Finance, Estimation of Working Capital, Profitability Estimations, Balance Sheet Projections, Projections of Sources and Uses of Funds. . : The Rationale for SCBA, Different Approaches to SCBA, methodology of SCBA Structuring Budgeting Valuing Projects: Appraising a Project by Discounting and Non Discounting Criteria, Appraising Projects with Special Features, FCF Approach, ERR Approach, Real Options – Issues in valuing long term Project Managing Financing Projects: Syndication, Islamic Finance, Leverage Leases, Various debt instruments and innovative Risk Analysis in Capital Investment Decisions: What is Risk, Types of Risk, Measurement of Risk, Method Multiple the Detailed Cases Faculty An A Allocation Market Technical Analysis Financial projections Environmental Social Structuring Projects Valuing Projects Project Negotiation Managing Project Risks Financing Projects Risk Multiple Detailed Project Reports