GUIDELINES FOR FM PROJECT

(GROUP 6 STUDENTS)

STAGE 1
Prepare a Business Idea. Work out the details and determine the funds requirement and the
life of the project.
 Minimum funding requirement should be of 50 lakhs
 Life of the project should be minimum 5 years

STAGE 2
Based on the funds requirement determine the capital structure for your business. You can
choose from equity, preference shares, debentures, loans or hybrid financing and alternate
sources of financing.
 Minimum 20% should be borrowed funds
 Minimum 20% should be equity funds

STAGE 3
Based on your capital structure determine the cost of raising the capital (interest, dividend
and flotation cost) and calculate the overall cost pf raising the capital.

STAGE 4
Prepare a loan amortization schedule for the loan amount and calculate how much amount
goes towards interest repayment and capital repayment.

STAGE 5
Prepare projected operating statement for the life of the project (minimum 5 years) show the
EBIT-EPS relationship. Calculate operating, financial and combined leverage. (Excel
calculation compulsory)

STAGE 6
Calculate cash flows from the operating statement and find out NPV and IRR of the project to
determine whether the business proposal is profitable or not. (Excel calculation compulsory)

NOTE:
Project report will comprise of 100 marks.
You have to submit all stages together in form of a pdf file via Edmodo.
Submission Deadline - 15th May 2021.
 FACULTY OF MANAGEMENT

Financial Management
Project Report

Submitted to: Dr. Tanvi Pathak

Submitted by:

Sr. No Enrollment No. Name

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