INSTITUTE –University School of

Business
DEPARTMENT -Management
MBA
Project Finance and Financial Modelling
: 22BAT-736
MSC: Dr. Rakhi Arora
Assistant Professor
Chandigarh University

DISCOVER . LEARN . EMPOWER

1
 Project Finance
Course Outcome
Cours Description Blooms
e Taxonomy
Outco Level
me
1 To understand the basic project financing Understand/
framework, concepts and process of project Remember
finance,
Will be covered in this
2 To apply the necessary qualitative and Apply lecture
quantitative tools and techniques for mitigation of
the project risk
3 To evaluate different project financing analysis Analyze
techniques to compare the outcomes of different
projects
4 To structure and appraise financing for large & Evaluate
medium projects
5 To Utilise the understanding of financial modelling Design/Create
to develop financial models for projects
https://www.expertmile.com/
LEARNING OBJECTIVES & LEARNING OUTCOMES
After studying this case study, you should be able to:
Understand the practical viability of project finance

3
 Topic – 4
Case Study

Source : UNESCAP 4
Performance-based management contract for a
water project in India
• Navi Mumbai is a port city of 0.8 million people in India. The
Municipal Corporation (the city government) used to provide the
water supply and sanitation services managed by the private sector
through a large number of labour-based annual contracts (42 for
water and 48 for wastewater).
• These contracts had focus on service delivery and were not
efficiency oriented. The services were not satisfactory and customer
complaints were unending. It was also difficult for the city to
administer and control contractor performance for large number of
contracts.

5
Performance-based management contract for a
water project in India
• With the technical assistance of the USAID, the 42 contracts in
water supply and 48 contracts in wastewater were transformed into
19 performance-based service (PBS) contracts for water supply and
6 similar contracts for wastewater services.

• The scope of these three-year PBS contracts included system

operation, new connections, water and energy audits, repair and
maintenance, and advisory services to the city.

6
Performance-based management contract for a
water project in India

• The results of this change in contractual arrangements brought

astonishing improvement in efficiency gains.
• Revenues increased by almost 45 per cent, over a period of two-
years the city reduced its annual energy consumption and the
chronic customer complaints almost completely disappeared.

7
 References

•TextBooks:
•1. Edward Yescombe, Principles of Project Finance, Yecombe Consulting Ltd., Academic Press
•2. Michael Rees, Principles of Financial Modelling: Model Design and Best Practices Using
Excel and VBA , The Wiley Finance Series)
•Reference Book:-
•1. Edward Bodmer, Corporate and project finance modeling, Wiley Finance Series
•India Infrastructure Report 2006; and David C. Mulford (India’s water and sanitation
challenges, The Hindu, online edition, 22 March 2006.)

8
 Assessment Pattern

Components HT-1 HT-2 Assignment Surprise Test Business Quiz GD Forum Attendance Scaled
Marks

Max. Marks 10 10 6 4 4 4 2 40

9
THANK YOU

10