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(solved) Corporate Financial Management PDF

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Added on  2020-03-16

(solved) Corporate Financial Management PDF

   Added on 2020-03-16

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Running head: CORPORATE FINANCIAL MANAGEMENTCorporate Financial ManagementName of the Student:Name of the University:Authors Note:
(solved) Corporate Financial Management PDF_1
CORPORATE FINANCIAL MANAGEMENT1Executive Summary:The report is mainly conducted to detect viability of the investment options that is presentedto Riverlea. Moreover, adequate evaluation of the opportunity in different circumstances isbeen conducted to identify its viability. In addition, different types of investment appraisaltechniques are mainly used in identifying viability of the new opportunity that is presented tothe company. Additionally, the investment appraisal techniques such as NPV valuationdirectly portray a positive value under all the three circumstances. Therefore, it is advisable toRiverlea for commencing with the overall project, as adequate profitability will be providedfrom the production of confectionery.The following part 2 mainly deals with the evaluation of the share price of Riverlea beforeand after the announcement of the extra income that will be generated in near future. Inaddition, the overall valuation could also help in identifying whether shares of Riverlea havestrong market efficiency or not. The calculations and evaluation mainly indicate that the shareprice of Roiverlea has adequate strong market efficiency to generate higher return frominvestment. Moreover, the use of short selling strategy could eventually allow the investor togenerate higher return from investment, as the share price after news announcement inflatedexponentially.
(solved) Corporate Financial Management PDF_2
CORPORATE FINANCIAL MANAGEMENT2Table of ContentsPart 1:.........................................................................................................................................31. Introduction:...........................................................................................................................32. Findings:.................................................................................................................................32.1 Evaluating the Discounted Rate:..........................................................................................32.2 Calculating the expected cash flows of the project:.............................................................42.3 Sensitivity Analysis:.............................................................................................................62.3.1 Calculation of the cash flow when 40% probability is there for 40% lowers incrementalrevenues:....................................................................................................................................62.3.2 Calculation of the cash flow when 10% probability is there for 20% increase inincremental revenues:.................................................................................................................83. Concussion and Recommendations:....................................................................................10Part 2:.......................................................................................................................................101. Introduction:.........................................................................................................................102. Findings:...............................................................................................................................112.1 Calculating and determining whether the stock is semi-strong efficiency:.......................112.2 Mentioning the trading strategy:........................................................................................133. Concussion and Recommendations:....................................................................................13Reference and Bibliography:....................................................................................................14
(solved) Corporate Financial Management PDF_3
CORPORATE FINANCIAL MANAGEMENT3Part 1:1. Introduction:The main aim of the assignment is to evaluate the opportunity that is presented toRiverlea by producing relevant confectionery in their premises. Moreover, adequateevaluation of the opportunity in different circumstances is been conducted to identify itsviability. In addition, different types of investment appraisal techniques are mainly used inidentifying viability of the new opportunity that is presented to the company.2. Findings: 2.1 Evaluating the Discounted Rate:The above figure mainly represents the CAPM value, which is calculated afterdetecting risk free rate, beta and market return. The overall risk free rate is mainly at 5.05%,with a beta of 1.5 and market retune of 9.22%. The CAPM value is mainly used as the cost ofcapital for Riverlea, which could in turn help in detecting vitality of the opportunity forproducing confectionery. In this context, Naseer and Bin Tariq (2015) stated that use of
(solved) Corporate Financial Management PDF_4

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