VINFLOW

SIMULATION

REPORT

Q2Y1
Q3Y1
Q4Y1
Q1Y2
Nguyen Ngoc Mai Q2Y1
Nguyen Duy Anh Q3Y1
Nguyen Duy Quang Q4Y1
Nguyen Vu Ha Ngan Q1Y2
Q2Y1
1. Current situation at the beginning of Q2Y1
In the previous quarter, we issued 200,000 shares while simultaneously researching and developing the
Basic Jetpack. At the beginning of this quarter, we currently hold $94,989 and are fulfilling contracts
for the Basic Jetpack. We begin by analyzing competitors' financial statements to determine whether
we will adopt a Vertical or Horizontal R&D strategy.

Notes: Financial Statements from the beginning of Q2Y1.

2. Decisions
To ensure smooth output and production processes, we have rented one more factory and produced
at full capacity to meet demand.

Subsequently, we issued 50,000 shares and 1,000 bonds maturing over 8 quarters, achieving an
impressive debt-to-equity ratio of approximately 0.5. Recognizing the potential of the Safe Jetpack in
the upcoming quarters, we decided to set the bidding price in the range of 25,000 to 30,000 to secure
contracts.

In marketing, we allocated $25,011 to secure a basic jetpack contract with an anticipated revenue of
$240,000. Through Market Forecast observations, we have decided to research and develop the
Sporty Jetpack, as the product demand for this item is expected to significantly increase in the coming
quarters, with a projected growth of 600 per quarter.

Our stock price maximization strategy prioritizes securing high-revenue and high-value contracts to
enhance overall financial health and operational efficiency. A robust financial position, driven by
lucrative contracts, is expected to boost investor confidence and attract stakeholders, ultimately
leading to an increase in our stock price.

In line with observation and our vertical strategy, ultimately, in this quarter, we are investing in the
Green Jetpack. Expected to dominate the market, the Green Jetpack aligns with consumer trends and
the government's emissions reduction goal, projecting a 1,000 demand growth per quarter. Its lithium-
ion battery and same as Sporty Jetpack speed make it our strategic choice, capitalizing on current
consumer behavior and environmental objectives. This positions us at the forefront of market trends,
enhancing our product portfolio and fulfilling our commitment to sustainability and innovation.
3. Outcome

Notes: Stock Price Formula for Q2Y1

At the end of Quarter 2 Year 1, the company's financial situation was stable, with a Net Income of
$19,368 and Ending Cash of $168,443, indicating a positive trajectory. In general, in this quarter, we
believe that we have performed quite well by setting the bidding price at a reasonable level to retain
contracts. However, the company's marketing budget was relatively high but did not achieve the
expected effectiveness.

Notes: Statement of Cash Flow for Q2Y1

Q3Y1
1. Current situation at the beginning of Q3Y1

Entering the third quarter, our company demonstrates a commendable financial standing, boasting
equity of $214,297 and liabilities totaling $100,000, culminating in a debt-to-equity ratio of 0.47. We
also had two rented factories and secured a basic jetpack contract with an anticipated revenue of
$240,000, which was the contract with the fourth-highest revenue.

Notes: Basic Jetpack contracts bidding result in Q3Y1

Meanwhile, our R&D efforts are dedicated to the Sporty Jetpack, showcasing our strategy of vertical
R&D. Despite a competitive landscape, our company stands out with the highest cash reserve among
industry peers, reaching $168,463.

Price
Company VinFlow JetJet Group 11 ngua
Industries

Beginning
$168,463 $118,269 $66,225 $38,474 $48,732
Cash

2. Decisions

Throughout the quarter, our strategy remained the same: accumulating substantial free cash flow (a
pivotal driver of shareholder value) for share buybacks and paying dividends. This involved an
approach of outgaining the number contracts compared to our competitors by expanding our product
line vertically, from Basic, Sporty, then Green. We also tried to maintain a strategic debt-to-equity
ratio around 0.5 for financial flexibility.
In production, we optimized resources by operating existing factories at 66%, producing 510 basic
jetpack units. The decision to rent three additional factories for $90,000 positions us strategically for
upcoming sporty jetpack contracts.

In marketing, deliberate budget allocations of $54,999 for sporty contracts and $30,123 for basic
contracts in the next quarter aim to secure multiple sporty jetpack contracts and enhance revenue
from basic contracts, aligning with our broader goal of increasing contracts and revenue.

Financial decisions, including issuing 125,000 more shares and 1,000 bonds maturing in 8 quarters,
underscore our commitment to building cash reserves for strategic investments. These choices align
with financial theories emphasizing optimal debt-to-equity ratios for long-term sustainability and
leveraging equity financing to facilitate growth.

3. Outcome
Despite achieving $240,000 in revenue and ending the quarter with $221,561 in cash, our group
incurred a net loss of ($121,396) due to substantial spending on marketing, factory rentals, and fixed
expenses. Notably, we secured 2 desired sporty jetpack contracts, outperforming competitors, but
failed to optimize our marketing budget for basic jetpacks, resulting in the fourth-highest revenue
contract. To enhance performance, we could have strategically lowered bids on basic jetpack
contracts, minimizing costs, and rented fewer factories to reduce operating expenses, aligning
resources with our focus on acquiring more lucrative sporty jetpack contracts in the selected quarter.

Notes: Income statement of VinFlow in Q3Y1

Q4Y1
1. Current situation at the beginning of Q4Y1
Enter Q4Y1, Vinflow had $200,000 in total liability and $266,211 in equity resulting in a safe debt-to-
equity ratio. The market offered two products: the Basic Jetpack and the Sporty Jetpack. However, the
time has come for companies to consider investing in the R&D of either the Green Jetpack or the Safe
Jetpack.

Vinflow is set to deliver two Sporty contracts and one Basic contract in Q4, totaling 3,200 products.
Given the company’s existing infrastructure (5 factories), fulfilling these contracts is expected to be a
smooth process. However, the question of where to direct R&D efforts remains.

2. Decision
Vinflow’s decisions during the last quarter (Q3Y1) were informed by a thorough analysis of financial
statements and market conditions.

In R&D, it was believed that no other teams were investing in the Safe Jetpack due to their cash holdings
which led to no investment in Green Jetpack. With substantial budgeted cash ($221,000), Vinflow has
decided to invest in the Safe Jetpack. This decision was driven by the understanding that failing to
prioritize safety could result in lagging sales volumes compared to competitors.

In production, we set Marketing costs at $10,000 for the Basic jetpack and $70,000 for the Sporty
jetpack to maintain our sales. Vinflow set a low promotion cost for the Basic jetpack because of its
decrease in demand. Otherwise, high cost for the Sporty jetpack because we wanted to maintain 2
contracts.

In finance, with the highest sales among companies and sufficient factories to fulfill contracts, Vinflow
decided to buy back 125,000 shares at a low price ($0.90) to increase the Sale per share index.
Consequently, the stock price increased due to high sales and low number of shares. The company also
decided to not establish more bonds to keep the debt-to-equity ratio at 0.75.
3. Outcome

Notes: Stock price formula at the end of Q4Y1

Those decisions led to a significant increase in the stock price to $3, promising more working capital
for the next quarter. However, we only received 2 contracts for both Basic and Sporty Jetpacks led to
the inefficiency of optimizing the cost that we had to solve in the next quarter.

Restrospectly, Vinflow would focus more on sales per share rather than other metrics if given the
chance to repeat the process. Company would maintain high marketing costs for the Sporty jetpack
category, as the team with the highest price consistently received two contracts. If we knew other
companies also participated in the Safe Jetpack market and abandoned the Green Jetpack market, we
would invest in the R&D of both Green Jetpack and Safe Jetpack to out-sell our opponents.

Notes: Income statement of VinFlow in Q4Y1

Q1Y2
1. Current situation at the beginning of Q1Y2
Recognizing undervalued stock, our BOD initiated a 125,000 share buyback, fueling a rise to $3 per
share – the market leader. This is our strategic move after gaining top-tier contract wins in Q3 (two
Sporty deals worth $580,900 in total) and strong production performance. Our R&D investments in
the promising Safe Jetpack project, along with share issuance to boost cash flow and company value,
solidify VINFLOW stock price’s position.

Notes: our Financial Statements from the beginning of year 2.

2. Decision
We issued back 125,000 shares to the market, earning $600,000 in cash. At that time, we faced a
challenging dilemma whether to sell Safe R&D and invest in Green R&D. These two markets are
mutually exclusive. Our reasons for this consideration: (i) Green R&D became a tempting option
after its skyrocketing increase of demand from 2000 to 6500. (ii) Previously, it was safe to enter the
Green Jetpack market to become monopoly. However, given the risk-taking characteristics of the
Friday-class market, our anticipation was that competitors may risk their shares in Safe Jetpack to
enter Green Jetpack.

VINFLOW also carried out competitor financial analysis:

Category Jet Jet Group ngua’s Group Group 11 BOT

Investing $50,000 $50,000 $150,000 $100,000

The investment of $50,000 was initially thought to be factory-operating costs. Therefore, we are
supposed to compete with only Group 11 and BOT in the Safe market. For risks of taking Green and
promising opportunities for Safe, we decided not to sell Safe. Our strategy was to bid high contracts
to earn higher net income, thus increasing our stock price.
We also issued 1000 bonds to have more working capital and bidding price, keeping debt-to-equity at
about 0.6, which is a safe rate below 1.
3. Outcome
After quarter 1, our revenue was at $576,000, with $400,994 operating expenses. If Vinflow’s BOD
could have made any change, they will fall into these main decisions:

First, for bidding price, initially, we chased high-revenue contracts, ignoring per-unit price. To boost
profit, we must prioritize contracts with high unit prices that still exceed average operating costs,
which has been adapted in Q2 Y2.

Secondly, about market adaptability, the Green market shifted, with flight tax removal boosting
potential, indicating $20 decrease in price and 17% demand increase. We missed this opportunity due
to information gaps.

Finally, about financial analysis, total $100,000 Safe R&D investment was accounted into 2 quarters.
Misinterpreting accounting rules led us to invest in the crowded Safe market instead of the Green
monopoly opportunity. Adapting to industry-specific accounting practices is vital for decisions.

Notes: News about Green Jetpack opportunities.

 APPENDIX
INCOME STATEMENT
STATEMENT OF CASH FLOWS
BALANCE SHEET