Financial Analysis Management<\/p>\n
Please follow the assignment instructions and marking scheme.
a) Financial report of FGV, IOI and KLK are per attached.
b) Format of Data of Financial Analysis (IOI) is per attached. Please do one for KLK as well for comparison.
c) Please analyse the FGV New Business Model as attached. Please critically evaluate financial performance and strategic of 2 mutually exclusive target acquisitions for FGV\u2019s business model 2015-2020 i.e. IOI or KLK.<\/p>\n
KEYWORDS of ASSIGNMENT
a) Financial Analyst
b) acquisition target
c) economic condition
d) financial performance
e) risk exposure
f) additional concern
g) investment appraisal techniques
h) Capital Investment Decision Making
i) You work as a FINANCIAL ANALYSIS for the CFO of FGV one of the largest plantation
companies in the world and listed on Bursa Malaysia (formerly the Kuala Lumpur Stock
Exchange)
Company FGV is considering the possible acquisition of a plantation group to further strengthen
the market dominance in this sector. The initial research has identify 2 potential acquisition targets,
Company IOI & Company KLK.
The CFO has asked you to write a brief internal management memo that summarises the current
business of each these two companies, together with a short assessment of the impact of the
recent economic conditions on them.
Requirement
\u2013 To critically examine the business profile of Company IOI & KLK to determine their strategic for
FGV Business Model.
\u2013 To determine the key economic drivers of change and their implications on current and future
performance of Company IOI & KLK.
b) Undertake the necessary research and write a report to your CFO which critically evaluates and
compares the financial performance and risk exposures of these , together with a REASONED
ARGUMENT as to your advice as to which company might be the preferred acquisition target.
Requirement
To critically evaluate financial performance and strategic of 2 mutually exclusive target acquisitions
for FGV\u2019s business model 2015-2020 i.e. IOI or KLK.
There must be critical and comparison\u2026\u2026\u2026
Substantial share holding.
Uncertainty of EURO Zone.
RATIO
a) Profitability
\u2013 GP margin\u2014- expense margin = 2684\/11910 X 100% = 22.5%
\u2013 OP margin\u2014\u2014-expense margin = 1778\/ 11910 X 100% = 14.9%
\u2013 expense margin = 22.5-14.9% = 7.6%
Cost structure changes
b) Liquidity
\u2013 current ratio
\u2013 quick ratio
When ratio is going up = long term finance. (PACKING ORDER THEORY dependent on the
availability)
c) Efficiency
\u2013 Debtor collection ; Example 40 days
\u2013 Creditor payment ; Example 30 days
d) Capital structure
\u2013 Gearing = Financial Risk up
\u2013 Interest cover = Interest cover down
\u2013 Financial risk is escalating
e) Investors
\u2013 EPS Given in Annual Report (BASIC EPS); look at income statement (Bottom)= Up= GOOD
\u2013 ROCE \u2013 Define Formula = Operating Profit\/ Total Assets X 100%= ??????%
\u2013 = Return of Capital employed
c) Your CFO also ask you to write a short report regarding \u201cCapital Investment Decision Making\u201d
which outlines the main investment appraisal techniques and critically evaluate their individual
strengths and weakness. Include a REASONED RECOMMENDATION as to which approach might
be the best for a company such as Company FGV to use to evaluate investments in new
distribution warehouses and logistics companies.
Requirement:
\u2013 To Critically evaluate and analyse investment appraisals. The conclusion must be rationally
justified and integrated and identify area to be checked before final decision.
\u2013 Compare and contrast methods using suitable examples:NPV, IRR, PAYBACK and PI clearly
highlighting challenges, strengths, weakness and contemporary issues involved.
\u2013 In order to form critical arguments based on contemporary issues in business environment and
their implications in the selection criteria investment appraisal techniques.<\/p>\n","protected":false},"excerpt":{"rendered":"
Financial Analysis Management Please follow the assignment instructions and marking scheme. a) Financial report of FGV, IOI and KLK are per attached. b) Format of Data of Financial Analysis (IOI) is per attached. Please do one for KLK as well Read More …<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-185375","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/185375","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/comments?post=185375"}],"version-history":[{"count":0,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/185375\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/media?parent=185375"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/categories?post=185375"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/tags?post=185375"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}