AF208 Group Assignment (20%)

Semester 2,2022
Assessment Guide

 The assignment is to be presented in a business report which includes an Executive

Summary. Your analysis should provide the support for your recommendations.

 The report should use size 11 or 12 font, with 1.5 line spacing.

 The report is limited to 1000 words. Any report longer than this will be penalised.

 The report is to include an Executive Summary of no more than 200 words.

 Due Date: Sunday 6th November 2022, 11.55 PM (FIJI TIME) (Week 11)

 Softcopy uploaded on Moodle (The member whose name is written first on the cover
page of the submitted assignment is to upload the softcopy on moodle). (15%)

 No Hardcopy will be accepted.

 The assignment is to be done in a group (3 to 4 members only).

Face-to-face Mode: Members to be from the same tutorial.

Blended Mode: Members to be from the same campus.

 Presentations to be conducted in Week 12 (5%)

Face-to-face : Presentations will be conducted in the SAFE postgraduate lecture room.

Blended Mode: Presentation to be conducted via zoom/Google Meet.

 Reports to be done in a professional manner with sub-headings and clearly defined

sections. Be succinct and clear. Reports must be word-processed, not hand written, word
size 12 with ‘Times New Roman’ font type and 1.5 spacing.

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Assignment Question

You are a financial analyst for YADRA Investment Ltd. You are required to analyse one of the
firms listed on the South Pacific Stock Exchange (SPSE). You are then required to recommend
whether or not to invest in the particular firm based on your analysis.

Assignment Details

The assignment provides an opportunity to get some practical experience applying corporate
finance principles to real firms. In the process, you will get a chance to

 Evaluate the risk profile of the firm, and examine the sources of risk;

 Analyse the firm’s stockholders;

 Examine the firm’s investment choices.

The Firm

 The firm must be listed on the South Pacific Stock Exchange

(https://www.spx.com.fj/Investing/Already-a-Shareholder/Listed-Entity-Financials)

 Select a firm that has plenty of publically available information with annual reports
published for the year 2021.

 Do not select a firm in the financial services industry.

 Face-to-face : Do not commence your work until your listed firm is confirmed by your
tutor.

 Blended Mode: Company signup will be conducted on Moodle in Week 3. One group per
company.

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Objectives of Assessment Task

 Develop critical and analytical skills relating to the topic areas addressed in the course

 Develop various research synthesizing skills

 Communicate clearly and effectively

Questions to Guide your Analysis

1. Firm Analysis

 Type of business and nature of operation

 Who is the average investor in this firm (Individual or pension fund, taxable or tax-
exempt, small or large, domestic or foreign)

 Is this company where there is a separation between management and ownership? If so, is
there evidence of conflict of interest between management and shareholders?

 What were the COVID-19 pandemic effects on financial results and how detailed have
the effects been disclosed in the annual report?

2. Risk and Performance

 What is the risk profile of your firm? How much overall risk is there in this firm? Where
is this risk coming from? How is the risk profile changing?

 Based on its stock price, do you think this company has performed well over the past
three years? Why?

3. The following specific industry norms are available in SPSE and used as benchmarks in
this analysis:

- Liquidity: Current Ratio

- Leverage: Debt/Equity

- Profitability: Profit Margin, Return on Equity, Return on Assets;

- Market Value: Price/Book value, Price/Earnings, Dividend Yield.

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Students will report on how the company performs as compared to the industry norms and where
the company stands relative to its competitors in the industry. The company’s weak and/or strong
areas of performance must be identified and recommendations for improvement presented. See
table 3 below for a sample industry comparative analysis.

Performance Area 2021 Ratios 2020 Ratios Comments

Leverage:

Debt/Equity (%)

Interest Coverage

Liquidity:

Current Ratio

Profitability:

Profit Margin (%)

Return on Assets (%)

Return on Equity (%)

Market Value:

Price/Book Value

Price/Earnings

Dividend Yield (%)

4. Valuation

 Considering the company’s dividends, what growth pattern would you pick for this firm?
How long will this growth last?

 Do you think the firm is correctly valued by the market? Why?

Marking Criteria
This assignment will be marked according to the following guidelines:
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 1. Content which includes the quality of source material, clear and precise identification and
evaluation of relevant issues and arguments raised as bases of conclusions.
2. Presentation of the assignment should be logical and coherent (headings can be used to
facilitate this requirement).
3. All parts of the assignment should be integrated.
4. Writing style, including English expression, spelling and grammar.
5. Overall quality of presentation which should include compliance with assignment
instructions.
6. Compliance with USP regulations as outlined in your Course Outline.

Comments Marks
Content 10
Writing Style 5
Presentation:
Integration of parts of the assignment 15
Major arguments and conclusion with 20
supported financial calculations.
Total marks 50

Note:
2 marks will be deducted each day for any late submission.
0 marks will be awarded for any plagiarism.

Assignment Cover page should be attached to the assignment. This is available on moodle.

All students must sign on the cover page declaring ethical and honesty practices with no
plagiarism or unethical academic practices being carried out.

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