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PROJECT OUTLINE
Please read this carefully simply because it is very very very important
Objective:
We will learn how to apply the theory learned in class to a Vietnamese company. You
will have the opportunity to select the company and:
1. Determine the value of a firm and assess how the following factors impact on the
value of firm
1.1 Risk profile and past investments of the firm and the sources of risk.
1.2 Capital structure and whether the firm is under or over leveraged.
1.3 Dividend policy and decide whether more or less should be paid in dividends
Working Arrangement
1
You analysis requires quantitative, qualitative, comparative and projective analysis. You
are also required to make a 15-minute presentation of your analysis in class during the
week commencing May 211.
In the following section each of the above sections are explained in some detail. This is
not comprehensive. But, it gives you a sense of what is expected in your submission.
I. Introduction
A brief history of the company that should cover but not be restricted to the following
items:
what the company does
who are its major competitors
any significant change in the nature of its operations in recent years
a brief description of its more recent financial history
distinctive features of its shareholders
distinctive features of its management/Board
Your discussion in this section should include but not be restricted to the following:
types of funding utilised by the firm
recent trends in the level of leverage used by the firm
the capital structure of the company relative to other similar companies
important factors that should influence the extent to which it uses debt finance
whether the firm's current capital structure is optimal
Your discussion in this section should include but not be restricted to the following:
the current and recent history of the company with respect to paying dividends
how the company's dividend policy compares of that of similar firms
any characteristics of the company that are relevant to its dividend policy
anything that the company does that is similar to paying dividends (e.g. share
repurchases-paying dividend not by cash but by issuing shares?)
whether the company's dividend policy is optimal
1
We may need more time than a lecture. Confirmation of this will be available later
2
IV. Valuation
Your discussion in this section should include but not be restricted to the following:
Use the WACC approach to arrive at an estimate of what should be the share price of
the company
Determine how sensitive this estimate is to changes in the more important
assumptions that you have to make when deriving this estimate
How does your estimate compare with the current share price and why might it differ
Based on your analysis and assuming that you already have a sizeable investment in
this company, would you increase your holding, leave it unchanged or decrease it?
You will need to play role of a group of Financial Analysts. Your group is hired to give
advice to an investor on investing decision in the firm.
Grade:
The 25% of the final grade allocated for this project will be divided up as follows:
Presentation 10%
Main report 15%
Each member of a group will be awarded the same grade unless one or more
members of the group feel this is unfair. In the event of such a disagreement, each
member of the group will be given the option of scoring the contribution of each
other member, on a scale of 1 to 5, and this information will then be used to
determine a separate score for each group member
3
Possible sources of information:
1. Annual reports
2. Company homepages in the Internet
3. Vietcombank Company Analysing Reports
4. States Securities Commission of Vietnam
5. Securities News – Company News
6. Securities Company websites
7. Textbooks and past researches for theoretical support
8. Websites: www.ssc.gov.vn www.ssi.com.vn
www.bsc.com.vn www.vndirect.com.vn
www.vcbs.com.vn www.vir.com.vn
www.hastc.org.vn www.hsc.com.vn
Tips to be outstanding:
Passion
Precise
Clear
Creative
Short and Simple