Project Finance Case Study: Azito Power Plant

Project Finance
practical case studies

Table of Contents
INTRODUCTION...........................................................................................................................1
Discussion........................................................................................................................................1
Project finance.............................................................................................................................1
Reason for Choosing the Case....................................................................................................2
Analyse the main purpose of the project.....................................................................................2
Evidence...........................................................................................................................................3
Analyse the financing source of the company Azito power plant along with the structure of
financing......................................................................................................................................3
Analysis ...........................................................................................................................................4
Calculation of financial ratios and its analysis............................................................................4
Identify two key credit risk.........................................................................................................5
Principle problems related to the Azito power plant...................................................................6
Lessons learned from the case study of Azito power plant.........................................................6
Summary..........................................................................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES ...............................................................................................................................8

INTRODUCTION
The case study discuss about the project finance document of the Company Azito power
plant basically the main purpose to make this finance report for get to know the company
financial position through understand the balance sheet of the company along with the cash flow
which mainly indicates the inflow and outflow of money in the organization, future projected
plan to perform the operational activity and the investors who invest their money in their
business for its expansion and the development purpose. Apart from this it also give the reason
for choosing this case study also it examine the main purpose of selecting the
project(Ahmadabadi and Heravi, 2019). After that, it analyse the main source of finance and the
structure of financing of the organization. Apart from this, it also compute some ratios of the
company which mainly indicates the financial position of the business in the company. It also
interpret the ratio and inform about the condition of business through the interpretation of ratios.
At last, it identify the credit risks and the problems which are faced by the company while
performing their projected tasks along with this it discuss about the lessons which they are
learned while preparing the report.
Discussion
Project finance
It is the process in which company is mainly required a funds in their business for
performing the long-term projects, which involves huge money to perform that big projects. It
mainly include those projects which are related to the projects of industries and public services
of infrastructure and others through a particular structure of finance. It is the mixture of both
liability and equity. Apart from this, the cash flows of the projects include debt servicing and
repaying of equity and liability. This project contains huge risk on the capita employed, there is
no revenue involved until the performance of operational activity is done(Featherston, 2019).
The parties who generate funds for their project they have no recourse available, if they fail to
achieve the target of their project because lenders who lend them money they use company
assets in case of its defaulted.
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