This document assesses the capital structure of Hutchison Whampoa based on its future financing needs. It analyzes Hutchison Whampoa's current capital structure ratios and compares them to industry averages. It also models how different ratios would be impacted by raising $500 million through various combinations of debt and equity. Overall, the analysis finds that Hutchison Whampoa's current capital structure ratios are healthy but could be optimized further to improve profitability and cash flow while maintaining financial stability.
Receivables Management-Definition,Objectives Of Receivable Management,Factors influencing the size of receivables,Dimensions of Receivables Management,Collection Methods Used
Receivables Management-Definition,Objectives Of Receivable Management,Factors influencing the size of receivables,Dimensions of Receivables Management,Collection Methods Used
Investments are a great way to allow your money to earn for you. However, to yield the best results, you cannot remain completely uninvolved. These can only be achieved with constant monitoring and fine-tuning of investments. For those who have extensive financial investments, the proper management of these investments could mean the difference between success and failure in the markets. While mutual funds are considered safer than traditional investments owing to their diversity, it’s very important to constantly monitor them with the help. In fact, there are professional financial planners for this purpose. This article will explain the benefits of calculating the NAV of your mutual fund investments with a financial planner.
Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. Factoring is commonly referred to as accounts receivable factoring, invoice factoring, and sometimes accounts receivable financing.
There are three parties directly involved: the factor who purchases the receivable, the one who sells the receivable, and the debtor who has a financial liability that requires him or her to make a payment to the owner of the invoice.
There are various types of factoring:
Recourse, Non - recourse, maturity and cross - border factoring.
Investments are a great way to allow your money to earn for you. However, to yield the best results, you cannot remain completely uninvolved. These can only be achieved with constant monitoring and fine-tuning of investments. For those who have extensive financial investments, the proper management of these investments could mean the difference between success and failure in the markets. While mutual funds are considered safer than traditional investments owing to their diversity, it’s very important to constantly monitor them with the help. In fact, there are professional financial planners for this purpose. This article will explain the benefits of calculating the NAV of your mutual fund investments with a financial planner.
Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. Factoring is commonly referred to as accounts receivable factoring, invoice factoring, and sometimes accounts receivable financing.
There are three parties directly involved: the factor who purchases the receivable, the one who sells the receivable, and the debtor who has a financial liability that requires him or her to make a payment to the owner of the invoice.
There are various types of factoring:
Recourse, Non - recourse, maturity and cross - border factoring.
Optimization Of Capital Structure Of Firm To Improve Profitability Complete DeckSlideTeam
This template will help the organization in optimizing debt ratio to maximize firm value and reducing cost of capital. The current scenario of firm depicts various sources of capital funding such as debt, equity capital, etc. The firms capital structure is analyzed on the basis of debt equity ratio, WACC, cost of equity and debt, present debt and equity pattern, etc. The debt equity ratio of the firm determines that firm is aggressively financed through debt which puts the firm in potential risk of financial distress or bankruptcy. The Chief Financial Officer will present this template to higher level management. The over levered firm will search different ways to shift to optimal debt ratio at minimum cost of capital by estimating optimal debt ratio on different rates with respect to cost of capital and firm value. The firm can alter its financial mix through ways such as equity recapitalization, divestiture and use of proceeds, new investment financing. The firm will raise capital funding through equity by initial public offerings process and leveraged buyout process. The alteration of financial mix will impact debt and equity pattern by reducing debt and increasing equity resulting lower debt equity ratio at minimum cost of capital. https://bit.ly/38bJcPg
Analysis of Financial Statements.(Ratio analysis, Du Pont system ,Effects of ...Tanjin Tamanna urmi
Five Categories of Fin. Ratios
Liquidity: Ability to meet current obligations
Asset Mgmt: Proper & effective use of assets
Asset utilization (i.e., Total Asset Turnover Ratio:
TAT = Sales / T. Assets
Debt Mgmt: extent of debt & level of safety afforded creditors
Debt utilization (i.e., Equity Multiplier:
EM = T. Assets / T. Eqty
Profitability: reflects effects of liquidity, asset mgmt, & debt on operating results
Expense Control: Profit Margin:
PM = Net Income / Sales
Market Value: indicators of what investors think of firm’s past results & future prospects
This presentation is an overview of Capital Structure Theories.
Dr. Soheli Ghose ( Ph.D (University of Calcutta), M.Phil, M.Com, M.B.A., NET (JRF), B. Ed).
Assistant Professor, Department of Commerce,St. Xavier's College, Kolkata.
Guest Faculty, M.B.A. Finance, University of Calcutta, Kolkata
Franco Modigliani and Merton H Miller Irrelevance Theory, Financial Indifference Point, Financial Leverage, Operating Leverage, Combined Leverage, Financial Break Even Point,
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
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How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
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Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
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USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
1. ASSESSMENT OF CAPITAL STRUCTURE OF
HUTCHISON WHAMPOA BASED ON
FUTURE FINANCING NEEDS
BY:-
TANIA ROY – 423
NITIN MEHROTRA – 425
TANMAY MEHTA –527
UTKARSH VASHISHTA – 528
SAHIL VOHRA - 530
2. WHAT IS CAPITAL STRUCTURE?
The term `capital structure' represents the total
long-term investment in a business firm
Includes funds raised through
ordinary and preference shares
bonds
debentures
loans from financial institutions
Any earned revenue and capital surpluses are
also included in the structure
3. CAPITAL STRUCTURE CONSTITUTES OF
CAPITAL
STRUCTURE
DEBTS EQUITY
ORDINARY & RETAINED
BONDS DEBENTURES PREFERENCE EARNINGS
SHARES
4. CAPITAL STRUCTURE FOR AN ORGANISATION
Optimum capital structure should be planned in a manner that
ensures that the market value of its shares is maximum
A number of factors influences the capital structure decision of a
company and significant variations among industries and among'
different companies
The judgment of the person or group of persons making the
capital structure decision plays a crucial role
These factors are complex and qualitative as capital markets are
not perfect and the decisions have to be taken knowing
consequent risks
5. FEATURES OF THE CAPITAL STRUCTURE
Planning is based on the interest
of shareholders
To be determined at initial stage
Capital Structure decision is a
continIous process
6. COMPONENTS OF CAPITAL STRUCTURE
THEREOTICAL
ANALYTICAL
Profitability
Flexibility
EBIT-EPS relationship
ROI-ROE relationship
Cost of capital
Debt ratio
Size of the company
Debt-equity ratio
Marketability
Total capitalization ratio
Control
Interest coverage ratio
Cash Flow
7. CASH FLOW
Conservatism related to the assessment of liability of
fixed charges
Amount of fixed charges are high when large debt is
employed
Debt should be raised only when provision for future cash
flow exists
It is risky to employ sources of capital with fixed charges
for companies whose cash inflows are unstable or
unpredictable
8. SIZE OF THE COMPANY
Small Companies Large Companies
Finds it difficult to raise long- Greater degree of
term loans, available at a flexibility in designing its
high rate of interest and on
inconvenient terms capital structure
Restrictive covenants in It can obtain loans at easy
loans make their capital terms and can also issue
structure quite inflexible ordinary shares,
The management thus preference shares and
cannot run business freely debentures to the public
They have to depend on
Management can run
owned capital and retained
earnings for their long-term business more freely
funds
10. EBIT-EPS ANALYSIS
How sensitive is EPS to changes in EBIT under
different financing alternatives
EPS = [(EBIT – I)(1 - t)] / n
I = interest burden
t = tax rate
n = number of equity shares
11. Assumptions
Plan A: all debt, no equity shares
Plan B: 75% debt, 25% equity shares
Plan C: 50% debt, 50% equity shares
Plan D: 25% debt, 75% equity shares
Plan E: no debt, all equity shares
Interest rate = 9%
Tax rate = 14.71%
12. Calculations
A B C D E
EBIT 12208.4 12208.47 12208.47 12208.47 12208.47
7
INTEREST 1098.76 824.07 549.38 274.69 0
EBT 11109.7 11384.4 11659.09 11933.78 12208.47
1
TAX 1634.23 1674.24 1715.05 1755.45 1795.86
EAT 9475.48 9709.76 9944.04 10178.33 10412.61
NO OF 4121.1 4140.9
ALL FIGURES IN HK$ MILLIONS 4160.72 4180.53 4200.35
SHARES
EPS 2.3 2.34 2.39 2.43 2.48
14. HUTCHISON’S CASE
Financing from cash on hand, internal cash
generation
Long term projects, large capital requirements
Increased outstanding debts and capital
commitments
Alternative source of financing
Appropriate mix of debt and equity
15. ROI-ROE ANALYSIS
Relationship between return on investment and
return on equity for different financing options
ROE = [ROI + (ROI – r)D/E](1-t)
r = cost of debt
D/E = debt – equity ratio
t = tax rate
18. COST OF CAPITAL
Minimize the cost of capital
Depends on expected returns and risk
Rate of interest fixed and company legally bound to pay
interest for debt holders
Rate of dividends not fixed and company not legally
bound to pay dividends in case of shareholders
Debt – a cheaper source of funds
Tax deductibility of interest charge
20. CONTROL
Existing management’s desire to continue its control over
the company
Risk of loss of control when new shares are issued
Use debt to avoid loss of control
49.9% shares owned by Cheung Kong holdings
New shares required – a very small percentage of
existing shares
Loosing control was not really a problem for the company
21. Ratios
Debt-Equity Ratio
Measurement of how much suppliers, lenders, creditors and obligors
have committed to the company versus what the shareholders have
committed
Provides a general indication of a company's equity-liability relationship
Large, well-established companies can push their liability structure to
higher percentages without getting into trouble.
22. Calculations
Current Future
Scenario Scenario
100%D, 0 75%D, 50%D, 25%D, 0%D,
%E 25% E 50%E 75%E 100%E
Total 26177 30044.5 29077.63 28110.75 27143.88 26177
Liabilities(
A)
Shreholde 58839 58839 59805.88 60772.75 61739.25 62706.5
r’s
Funds(B)
D/E 0.44 0.51 0.48 0.46 0.44 0.41
Ratio(A/B)
Current D/E Ratio is ideal
Even if US$ 500M is raised through entire debt the ratio
remains at 0.51 which is also quite stable
23. Total Debt Ratio
Compares a company's total debt to its total assets
• A low percentage means that the
company is less dependent on
leverage
• higher the ratio, the more risk
24. Calculations
Current Future
Scenario Scenario
100%D, 0% 75%D, 50%D, 25%D, 0%D,
E 25% E 50%E 75%E 100%E
Total 31503 35370.50 34403.63 33436.75 32469.88 31503
Liabilities
(A)
Shreholder’ 58839 58839 59805.88 60772.75 61739.63 62706.5
s Funds(B)
Inference0.54
Total Debt 0.60 0.58 0.55 0.53 0.50
Ratio(A/B)
Current Total Debt Ratio is quite good
Higher the debt , Higher is Total Debt Ratio
25. Capitalization Ratio
Measures the debt component of a company's capital structure to
support a company's operations and growth
Describe the makeup of a company's permanent or long-term
capital
Prudent use of leverage increases the financial resources available
for growth and expansion
Highly leveraged company may find its freedom of action restricted
by its creditors or have its profitability hurt by high interest costs
26. Calculations
Current Future
Scenario Scenario
100%D, 75%D, 50%D, 25%D, 0%D,
0%E 25% E 50%E 75%E 100%E
Long Term 26174 30041.5 29074.55 28107.5 27140.88 26174
Debt(A)
Total 85013 88880.5 88880.5 88880.5 88880.5 88880.5
Capitalizati
on (B)
Total 0.31 0.34 0.33 0.32 0.30 0.29
Capitalizati
Inference
on
Ratio(A/B)
Current Capitalization of 0.31 provides a cushion to
investors
Even if whole US $500M is raised through debt, the total
capitalization will still be stable
27. Interest Coverage Ratio
Determine how easily a company can pay interest expenses
on outstanding debt
The lower the ratio, the more the company is burdened by
debt expense
The non-payment of debt principal is a seriously negative
condition
A company finding itself in financial/operational difficulties
can stay alive for quite some time as long as it is able to
service its interest expenses.
28. Calculations
Current Future
Scenario Scenario
100%D, 75%D, 50%D, 25%D, 0%D,
0%E 25% E 50%E 75%E 100%E
EBIT(A) 11181 12208.47 12208.47 12208.47 12208.47 12208.47
Interest (B) 2808 3906 3632 3357 3082 2808
Interest 3.98 3.13 3.36 3.63 3.96 4.34
Coverage
Ratio(A/B)
Current Ratio of 3.98 is quite good.
Company can pay its interest obligations easily
As Debt borrowed increases, Interest Coverage decreases
31. EBITDA INTEREST COVERAGE
EBITDA / Interest Expense
3.8
3.7
•Comparatively better 3.6
• It can be further improved 3.5
3.4
by reviewing the tangible and 3.3
intangible assets of the 3.2
company. 3.1
3
1995
Hutchison
3.7
Whampoa
Industry
3.25
avg
32. FUNDS FROM OPERATIONS/ TOTAL DEBT(%)
Operating Cash Flow / Total Debt
•Funds generated from
40
operations are less related to 35
debts. 30
•Operating cost for this 25
company is high. 20
15
10
•Suggestions: 5
•Need to optimize the 0
operations by employing 1995
Skilled labour, latest Hutchison
14.8
Whampoa
technology etc.
Industry
36.3
avg
33. FREE OPERATING CASH FLOW/ TOTAL DEBT
(%)
Free Operating Cash Flow = EBIT(1-Tax Rate) +
Depreciation & Amortization - Change in Net Working
Capital - Capital Expenditure
50
45
•Poor performance in terms 40
35
of Free operating cash flow. 30
25
20
•Suggestion: 15
10
Company should sell some 5
0
of its inefficient assets. 1995
Hutchison
7.3
Whampoa
Industry
46.2
avg
34. OPERATING INCOME/SALES(%)
Operating Income / Total Sales (Revenue)
20
• Is an indicator of 18
profitability of a company 16
14
12
• Hutchison Wampoa is 10
performing better in 8
terms of profitability. 6
4
2
• Operational optimization 0
can further improve the 1995
performance. Hutchison
17.8
Whampoa
Industry
11.43
Avg
35. LONG TERM DEBT/CAPITAL(%)
Long Term Debt / Long Term debt + Preferred Stock +
Common Stock
• Higher value for 35
Hutchison Wampoa 30
indicates that it is 25
20
relying more on long
15
term debts.
10
5
• Suggestion: 0
1995
Short terms debts
Hutchison
can be one of the 28.9
Whampoa
options. Industry
22.35
avg
36. TOTAL DEBT/CAPITALIZATION(%)
Debt / Debt + Shareholders’ Equity
50
• This is not a good 45
40
indication as higher debt 35
value will limit company’s 30
25
flexibility. 20
15
10
5
0
1995
Hutchison
44.8
Whampoa
Industry
31.05
avg
37. RETURN ON EQUITY(%)
Net Income / Shareholders Equity
• Comparatively better 18
performance as 16
Hutchison Wampoa is 14
giving a higher return 12
10
on equity. 8
6
4
2
0
1995
Hutchison
16.5
Wampoa
Industry
10.75
avg
38. CONCLUSION
On the basis of the analytical and theoretical criteria
we propose a capital structure for the company
comprising of 60% debt and 40% equity which will
minimize the cost of capital and maximize the value
of the firm.
%
EQUITY
40%
DEBT
60%
39. MARKETABILITY
Ability of the company to
sell or market particular
type of security in a
particular period of time
which in turn depends upon
-the readiness of the
investors to buy that
security
Sometimes market favours
debenture issues and at
another time, it may readily
accept ordinary share
issues
Company decides whether
to raise funds through
common shares or debt
based on changing market
sentiments
40. FLOATATION COST
Floatation costs are incurred when the funds are raised
Cost of floating a debt is less than the cost of floating an
equity issue, hence companies use debt rather than
issuing ordinary shares
If the owner's capital is increased by retaining the
earnings, no floatation costs are incurred