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    Project Guidelines_FCF

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    mrbakchod107
    Project guidelines of a building project

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Project Guidelines_FCF

    Uploaded by

    mrbakchod107
    2 views2 pages
    Project guidelines of a building project

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    © © All Rights Reserved

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    PDF, TXT or read online from Scribd

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    Project guidelines of a building project

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    2 views2 pages

    Project Guidelines_FCF

    Uploaded by

    mrbakchod107
    Project guidelines of a building project

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    Project Guidelines

    Selecting Companies and Industry

    1. After creating groups, the class representative will coordinate the industry allocations
    among the different groups to ensure that each group study different industry and
    maximum NIFTY companies are studied by the participants
    2. Please make sure that groups do not take Banking, Financial Services, Utilities, and
    Government companies for the project.
    3. Each member of a group will choose a company (from the allocated industry of the
    group) that is listed in NSE. The class CR will float a google spreadsheet with the
    following columns, and each group member will fill up the details:

    Section Group# Name Roll No. NSE Company Industry


    Symbol name

    4. Please ensure that the company (taken by each participant) is listed in the NSE for the
    last five years (April-2019 to March-2024). Ex: Suppose you choose NSE Symbol
    ‘XYZ’, make sure that continuous trading data is available for ‘XYZ’ for the last 5-
    years.
    5. Ensure that No NSE symbols are repeated.
    6. The instructor may ask you to changes companies if needed.

    Project Instructions

    For Excel Submission

    1) You may take the adjusted closing share price data of (daily data) from April 1, 2019
    to March 31, 2024, along with NIFTY500 Index data (proxy for market portfolio) from
    the NSE Database.
    2) First, you will sort the share price data on daily basis and then estimate the daily returns.
    Similarly, the return on the market portfolio must be estimated.
    3) Calculate average daily return, average monthly return and average yearly return for
    past 5 years. Also calculate the standard deviation of returns for the company.
    4) You may run regression to estimate the beta-equity of the company. You will provide
    the information on adjusted R square, standard error of estimate, and value of alpha and
    beta coefficients.
    5) You may get the data on debt ratio (based on market values) by referring to the Annual
    Report of the Company (and/or corporate bonds (if any) issued by the corporation.)
    Otherwise use the book value of debt. The debt ratio has to be estimated as on March
    31, 2024.
    6) Estimate the cost of equity capital of the company by using the CAPM. You may refer
    to RBI web site for ascertaining the current yield on 10-year/30-year GOI bonds. Take
    the equity risk premium from a reliable source and cite the source in the report.
    7) Estimate the cost of debt in respect of your company. In the absence of the current yield
    data, one may ascertain cost of debt by taking the ratio of interest expense to average
    debt outstanding during the year.
    8) Estimate the WACC in respect of your company by using the market value weights.
    For Report Submission

    1) Analyze the capital structure of each company and the industry. What is the debt/equity
    ratio for each firm? What is the average industry debt/equity ratio? What industry
    characteristics affect debt capacity in this industry?
    2) What is the payout policy for each firm? What are dividend payout and dividend yield?
    What is the average industry dividend payout? What industry characteristics affect
    payout policy in this industry?
    3) What is the working capital policy for each firm? How much investment is needed in
    working capital? What is the industry average?
    4) Learnings from this project.

    Deliverables
    1. Final submission will be in two parts. The part 1 will have an Excel submission and the
    part 2 will have a report.
    2. Every group will submit 1 excel file. The first sheet will be a summary sheet with following
    details for each company:

    Particulars Company 1 Company 2 Company 3 …


    Name of company
    NSE Code
    Industry

    Average return (Daily)


    Average return (Monthly)
    Average return (Yearly)
    Standard deviation

    Beta

    Debt (Rs. million)


    Equity (Rs. million)
    Cost of debt
    Cost of equity
    WACC

    5) Post the summary sheet attach the individual company sheet (one sheet per company)
    6) The report should be in the pdf format.
    7) Naming Convention: <Group Number><Section>

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