St04 - Project Finance

VCE Summer Internship Program 2020 Smart Task 04

Project Topic : Project Finance - Modeling and Analysis INSTRUCTIONS 

 

✔ Interns  need  to  prepare  a  final  internship  report.  The  formatting,  content  and  the  analysis of the  report should be upto corporate standards.  ✔ The  intern  needs  to  go  through  the Industry Case Problem Statement and select ONE project from  it. That project will be the topic and title of the final report.  ✔ Apart  from  making  one  report,  there  is  NO  other  task  in  this  module.  Your  evaluation  of  this  internship will be done on the report and hence make it in a professional way. 

PREPARATION OF CORPORATE STANDARD REPORT   

1. The report should be in the A4 page ONLY, prepared on MS Word / Google Docs / WPS. Reports in the form of presentation will NOT be accepted. 2. The report SHOULD be well formatted and MUST have all the features of a good report. Such as Cover Page, Executive Summary, Table of Contents, List of Figures, List of Tables, Footnote, Endnote, Justified Text, Bibliography and References. Please check the Sample Report for reference. 3. Sample Report:- ​https://drive.google.com/open?id=1pK-UMj3KJGUzkSZ7LRGiNMX_mNM_f2Bw 4. Report SHOULD have pictures, graphs, tables and charts etc showing the analysis done during the project. Having ONLY text in the report is not acceptable. 5. Report SHOULD contain 15-30 pages, including all pages. 6. The content of the report SHOULD have “Introduction” as first chapter and “Conclusion” as last chapter. The middle chapters can be chosen as per the project title and analysis done. 7. In the executive summary, the interns should mention about VCE and the experience about this internship. There is NO need to mention about VCE anywhere else in the report. 8. The content of the report SHOULD be in your words, so that you can take the reference of this report in future. 9. Your quality of report will be the main deciding factor for evaluating your work in this internship. We will provide an internship certificate, letter of recommendation and select the best interns as per the report submitted by the interns. So, focus and prepare it as per the instructions.

https://techvardhan.com/

VCE Summer Internship Program 2020 Smart Task 04

INDUSTRY CASE PROBLEM STATEMENT  M/s Vardhan Consulting Engineers “VCE” is a management consulting firm, which provides consultancy to energy and infrastructure developers to raise debt and equity for their projects. In terms of project finance (non-recourse debt) and private equity. For doing this the financial analysts and consultants at VCE prepare financial models of the projects and perform the analysis and figure out the Equity IRR, DSCR for the project. As an intern of VCE, we would like you to help some of our clients by preparing financial model and report on different cases (you need to select ONE case only). Instructions to prepare the Financial Model A. In this task every intern needs to select ONLY ONE case from the list. B. Interns needs to take appropriate assumptions ( What so ever required) to finish the analysis. The details and the results of the analysis should be mentioned in the report submitted by the intern. C. The financial model needs to be prepared in MS Excel. Hence, the .xls file of the financial model is required to be submitted separately. D. Submission in any other format such as PDF or DOC is NOT accepted. The candidate can take reference from the financial model provided in Module 2. E. The financial model should have four sheets, Revenue, Cost, FinFlows and Debt. F. This task should be submitted directly through email to ​[email protected] but the report should be submitted through the link.

CASE-01   

Project Title :​ Financial Modeling and Analysis of 10 MW Solar/Wind Power Project in Porbandar, Gujarat IN  Techvardhan  Power  Pvt.  Ltd  (Any  Company)  “CLIENT”  has  signed  a  PPA  for  25  years  with  GUVNL  for  a  10  MW  Solar  PV  /  Wind  Power  Plant  at  a  fixed  tariff  of  Rs.  3.50  /  kWh.  The  project  location  is  in  Porbandar  Gujarat,  India.    They  are  expecting  a net annual energy production of 18 Million kWh / year with a degradation of 1% per annum.  The expected CapEx is Rs. 3 Crore / MW and OpEx is Rs. 30 Lacs / per annum for the whole plant.    They  are  seeking  a  non-recourse debt (project financing) with 70:30 as D/E ratio from leading commercial banks  in India as a 12 years (maximum) term loan.    Please  prepare  a  financial  model  and  analyse  the  cost,  revenue  and  debt  repayment  along  with  finflow  /  cash  flow analysis. Calculate equity IRR and DSCR. 

https://techvardhan.com/

VCE Summer Internship Program 2020 Smart Task 04

CASE-02   

 

Project Title : Financial Modeling and Analysis of 20 TPD Pyrolysis Project in Pune, Maharashtra IN 

Techvardhan  Energy  Pvt.  Ltd  (Any  Company)  “CLIENT”  has  signed  a  long  term  FSA  with a large industrial player  for  supplying  refined  pyrolysis  oil  of  10,000  LPD  at  a  rate  of  Rs.  15  per  Litre.  They  want  to  set  up  a  20  TPD  pyrolysis plant near Pune MH. 

 

The expected CapEx is Rs. 10 Crore and OpEx is Rs. 2 Crore / per annum for the whole project. 

 

They  are  seeking  a  non-recourse debt (project financing) with 70:30 as D/E ratio from leading commercial banks  in India as a 12 years term loan. 

 

Please  prepare  a  financial  model  and  analyse  the  cost,  revenue  and  debt  repayment  along  with  finflow  /  cash  flow analysis. Calculate equity IRR and DSCR. 

CASE-03 

 

  Project Title : Financial Modeling and Analysis of 50 Flats Housing Project in Gurgaon, Haryana IN 

Techvardhan  Infra  Pvt.  Ltd  (Any  Company)  “CLIENT”  has  acquired  a  piece  of  land  near  Gurugram HR and wants  to develop it as a residential building having 50 flats of 900 sq. ft each. 

 

They  are  expecting to sell the flats at a rate of Rs. 4000 / sq.ft. The expected CapEx is Rs. 8 Crore and OpEx is Rs.  50 Lacs / per annum for the whole project. 

 

They  are  seeking  a  non-recourse debt (project financing) with 70:30 as D/E ratio from leading commercial banks  in India as a 12 years term loan. 

 

Please  prepare  a  financial  model  and  analyse  the  cost,  revenue  and  debt  repayment  along  with  finflow  /  cash  flow analysis. Calculate equity IRR and DSCR. 

  CASE-04   

Project Title : Financial Modeling and Analysis of PPP based Airport Development Project in Ranchi, JH   

Techvardhan  Infra  Pvt.  Ltd  (Any  Company)  “CLIENT”  has  been  alloted  a  project  of building and operating (for 20  years)  a  new  commercial  airport  in  Ranchi,  JH.  They  can  charge  different  charges  to  the  airlines  through  their  Schedule  of  Charges​.  The  charges  were  eventually  paid  by  the  passengers  which  roughly  calculated  as  Rs.  500  per passenger. 

 

They  are expecting to have a passenger traffic of 1 Million with an increase of 5% every year. The expected CapEx  is Rs. 100 Crore and OpEx is Rs. 25 Crores / per annum for the whole airport. 

https://techvardhan.com/

VCE Summer Internship Program 2020 Smart Task 04

 

They  are  seeking  a  non-recourse debt (project financing) with 70:30 as D/E ratio from leading commercial banks  in India as a 12 years term loan. 

 

Please  prepare  a  financial  model  and  analyse  the  cost,  revenue  and  debt  repayment  along  with  finflow  /  cash  flow analysis. Calculate equity IRR and DSCR. 

  CASE-05   

 

Project Title : Financial Modeling and Analysis of PPP based Expressway Project in Hyderabad, TN 

Techvardhan  Infra  Pvt.  Ltd  (Any  Company)  “CLIENT”  has  been  alloted  a  project  of building and operating (for 20  years)  a  new  expressway  between  Hyderabad  and  Anantapur  AP.  They  can  charge  different  charges  to  the  vehicles  using  the  expressway  through  their  Schedule  of  Charges,  which  is  averagely  calculated  as  Rs.  160  per  vehicle. 

 

They  are  expecting  to  have  a  vehicle  traffic  of  10000  vehicles  per  day  with  an  increase  of  5%  every  year.  The  expected CapEx is Rs. 200 Crore and OpEx is Rs. 28 Crores / per annum for the whole airport. 

 

They  are  seeking  a  non-recourse debt (project financing) with 70:30 as D/E ratio from leading commercial banks  in India as a 12 years term loan. 

 

Please  prepare  a  financial  model  and  analyse  the  cost,  revenue  and  debt  repayment  along  with  finflow  /  cash  flow analysis. Calculate equity IRR and DSCR. 

  CASE-06   

 

Project Title : Lender's Analysis of Project Financial Cash Flows and Risk Assessment of Infrastructure  Projects. 

Techvardhan  Infra  Bank  Ltd  (Any  Company)  “CLIENT”  is  a  bank  who  want  to  provide Non-Recourse Debt as per  their policy.     They  want  your  help  to  analyse  the  financial  models,  cost  break  up  and  revenue  realization  sheets  and  make  a  credit worthiness report on any proposed infrastructure project for project financing.    Take  the  example  of  any  infrastructure  project  from  the  above  and  create  a  credit  worthiness  report  of  the  project.  Please  perform  a  risk  assessment  also  and  advise  the  bank  if  it  is  worthy  to  fund  or  not  as  per  the  financial model. 

*** https://techvardhan.com/