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Frozen Food Investment Profitability Analysis

Maria D'Souza runs a frozen foods business and wants to know if expanding into a new product line using IQF technology would be profitable. She plans to invest in a new project to introduce seasonal frozen fruits and vegetables that can be stored for over a year. To evaluate the potential profitability, the student group analyzed the financial aspects and calculations related to the cost of capital for the new investment project. Their decision was that if the average return of the new project exceeds its cost of capital, then the investment would be profitable for Maria D'Souza's business.

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Amar Singh
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114 views6 pages

Frozen Food Investment Profitability Analysis

Maria D'Souza runs a frozen foods business and wants to know if expanding into a new product line using IQF technology would be profitable. She plans to invest in a new project to introduce seasonal frozen fruits and vegetables that can be stored for over a year. To evaluate the potential profitability, the student group analyzed the financial aspects and calculations related to the cost of capital for the new investment project. Their decision was that if the average return of the new project exceeds its cost of capital, then the investment would be profitable for Maria D'Souza's business.

Uploaded by

Amar Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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CASE ANALYSIS

Frozen Food Products - Cost of Capital

DONE BY: GROUP 13

AMAR AGARWAL MBA08018


ANKITA BHUVAD MBA08039
TANISH CHUBE MBA08050
DHARSHINI P MBA08058
Problem statement
Maria D'souza wanted to know how much is her new investment for

expanding her business is profitable.

Case summary
Maria D'Souza runs the business of frozen foods which was started

in 1980 by her father. Currently, in India, the demand for processed

food was growing and the major market segments were retail

outlets for direct consumption. D'Souza wanted to introduce a new

product line of frozen food using IQF technology which could make

seasonal fruits and vegetable be stored for more than a year. She

planned to maintain a separate account for the new project to

monitor it independently. The debt to equit ratio of the new project

was proposed to be 1:3.


Financial Aspects
Calculations
Decision

Average Return > Cost of Capital


Investment is profitable

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