PROJECT PROPOSAL

Valuation Of Firm For Financing

CMS BUSINESS SCHOOL
Submitted to: Dr. BRR









By:
Rituraj Deka
13MBA63230

Abstract:
As commodities trading continues to globalize, many of the worlds biggest oil and gas and
mining majors have set up commodity trading structures. KPMG Internationals report titled
Commodity trading companies - Centralizing trade as a critical success factor was recently
developed based on the views of professionals from KPMGs member firms worldwide who
specialize in a range of global tax and advisory disciplines to help energy and natural resources
companies understand the substantial benefits and risk management issues involved in these
complex operations.
Objective:
To understand realistically the pattern of fluctuations of price indices of Gold commodities
Problem statement:
To analyze and calculate the risk involved in advancing loans.
Methodology:
Standard and premise of value are popular alternatives in the valuation of a firm.
The standard of value is the hypothetical conditions under which the business will be valued. The
premise of value relates to the assumptions, such as assuming that the business will continue
forever in its current form or that the value of the business lies in the proceeds from the sale of
all of its assets minus the related.
Standard of Value is the decision considering the Fair market value, the Investment value or
intrinsic value.
Financial analysis (including financial statements and ratios), Normalization of financial
statements to identify the ability of the business to generate income also including Net Asset
Value method.
Capital Asset Pricing Model (CAPM), and Weighted average cost of capital (WACC).
The CAPM method derives the discount rate by adding a risk premium to the risk-free rate and
the WACC method determines the subject companys actual cost of capital by calculating the
weighted average of the companys cost of debt and cost of equity.



Schedule:
Completion of 1 method of valuation per week from the commencement of Internship.
Submission for mentors revision will be done by 1
st
of September 2014. Final submission will
be on or before 5
th
of September.
References:
The Little Book of Valuation by Aswath Damodaran
http://en.wikipedia.org/wiki/Valuation_%28finance%29