Essay sample - Investment Appraisal: The Zeta plc. Case

Investment Appraisal: The Zeta plc. Case Essay example
Masters
Essay
Finance & Accounting
Pages 6 (1506 words)
Download 0
Investment Appraisal: The Zeta plc Case Introduction One of the major objectives of any company is to make itself efficient enough to undertake expansion of its business activities which can also be named as growth activities. Growth of any organization is mainly occurred either as organic growth or as growth through mergers and acquisition (Brigham et al, 2008)…

Introduction

This article aims at carrying out an investment appraisal activity for a company named as The Zeta plc. The company has found an opportunity to manufacture a series of exclusive sailing boats over a period of four years and it is intended to dispose of the project after four years. However, the company needs to evaluate this investment opportunity as to whether it would be viable for the company on financial grounds or not (Baker et al, 2011). The overall project is mainly appraised by the discounted cash flow based techniques which include Net Present Value (NPV), Internal Rate of Return (IRR), Profitability Index (PI) and lastly Discounted Payback Period (Dis. PBP). The theme of this article is set in such a manner that each of the above mentioned techniques are explained on their theoretical grounds and then the findings of the project of The Zeta plc are evaluated on the basis of underlying theories. At the last stage of this article, the main assumptions are stated which are used in conducting the investment appraisal of the project followed by the appendix in which the detailed workings are shown to arrive at the findings. ...
Download paper
Not exactly what you need?

Related papers

Investment Appraisal Techniques
Some of the investment appraisal techniques used range from Net Present Value (NPV), Accounting Rate of Return (ARR), Internal Rate of Return (ARR) and Payback Period. Net Present Value (NPV) As one of the investment appraisal techniques, net present value (NPV) method ensures that the value of all the expected future cash flows is calculated into the present values (Droms, & Wright, 2010). More…
5 pages (1255 words)
Investment appraisal and NPV analysis
Capital Budgeting is the other name for Investment Appraisal. Every firm, company or enterprise is faced with the decision about which investment opportunities they are to choose from all the options available. The primary task of any enterprise is to maximize the wealth of its shareholders. So taking the right decision at right time is one of the key roles of any company. It is required for the…
8 pages (2008 words)
Investment Appraisal Project
WACC=wdkd(1-T)+wpkp+wsks Where  Kd = interest on debt  Kp = cost of preference shares  Ks = cost of shares and retained earnings.  WACC is calculated by multiplying the cost of equity by the market value of the equity and cost of debt by the market value of the debt. Cost of equity can be defined as the minimum rate of return that a company must generate and offer to their investors in order…
8 pages (2008 words)
Investment appraisal under uncertainty
Literature review Real option valuation calls for an elaborate and a firm strategy to form a conceptual tool to make the decision for the company (Kim & Sanders 2002). The most appropriate tool to be used in uncertainty cases is using real option as a technique to assess investments for contexts with high market, technical and technological uncertainty (Billington, Johnson & Triantis 2002). This…
5 pages (1255 words)
Investment Appraisal
Investment Appraisal …
9 pages (2259 words)
Investment Appraisal: Matero Corp
The management will have to evaluate the projects which will generate stable cash flows for Matero PLC for at least 1 year. From the onset, we consider the possible consequences of Matero accepting or rejecting the project of procuring the machinery and plant. For this reason, we emphasise on the determination of the cost of capital whether there will be any form of financial leverage or not. If…
6 pages (1506 words)
Investment appraisal
This analysis has been conducted based on several financial theories related to equity valuation. 1 Introduction 1.1 History of Google Google, a name synonymous with world leader in specializing in internet related services and product. The product and services offered by Google are vast and its operations are expanding at a rapid pace. The primary services offered by this giant corporation…
6 pages (1506 words)