1 / 35

Chapter 6 How to Analyze Investment projects

Chapter 6 How to Analyze Investment projects. objectives -- To show how to use discounted cash flow analysis to make decisions such as Whether to enter a new line of business Analyze how to decide whether to invest in equipment to reduce operating costs. ☆ Contents.

zurina
Download Presentation

Chapter 6 How to Analyze Investment projects

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Chapter 6 How to Analyze Investment projects • objectives -- To show how to use discounted cash flow analysis to make decisions such as Whether to enter a new line of business • Analyze how to decide whether to invest in equipment to reduce operating costs

  2. ☆ Contents • 1 The Nature of Project Analysis • 2 Where do Investments Ideas come from? • 3 The NPV Investment Rule • 4 Estimating a Project.s Cash Flows • 5 Cost of Capital • 6 Sensitivity Analysis • 7 Analyzing Cost-Reducing Projects • 8 Projects with Different Lives • 9 Ranking Mutually Exclusive Projects • 10 Inflation & Capital Budgeting

  3. 6.1 The Nature of Project Analysis • We apply the techniques of Discounted Cash Flow to the analysis of investment decisions by business firms. • The process of analyzing the investment decision(or choosing the company’s long-term capital investment) is called Capital Budgeting. • The process of Capital Budgetingcan be broken down into five steps as a project moves from idea to reality: -- Generating ideas for capital budgeting projects. -- Preparing proposals -- Reviewing existing projects and facilities. -- Evaluating proposed projects and creating the capital budget, the company’s set of planned capital expenditures. -- Deciding and preparing appropriation requests.

  4. 6.2 where do Investment Ideas Come From? • Classifying Capital Budgeting Projects -- Maintenance projects -- Cost-saving / Revenue-enhancement projects -- Capacity expansion in current businesses -- New products and new businesses -- Projects required by government regulation or company policy Division management ideas ideas ideas R&D ideas Plant management Strategic planning ideas Production management and other employees

  5. 6.3 The Net present Value Investment Rule • Cash Flow:指与投资项目有关的现金流入流出的数量。 • Consist of cash flow： -- Cash flow into -- Cash flow out -- Net Cash Flow NCF = CF in investment + CF in operating + CF in the ending • Discounted CF • Cumulative PV • Example pp.168-169

  6. --cont’ • Why using Cash Flow in investment decision? -- helpful to take the time factors into account -- make the project’s decision more real （limit of profit） -- considered the payback of investment step by step

  7. 6.4 Some investment decision rule • Static valuation ☆ investment payback method：通过一个项目所产生的未折现现金流量足以抵销初始投资额所需要的年限，即用项目回收的速度来衡量项目投资方案的一种方法。 ☆static payback：从项目投建之日起，用项目各年的未折现现金流量将全部投资收回所需的期限。 ☆basic formula： ☆static payback: Pt=T-1+（第T-1年累计净现金流量的绝对值）/第T年的净现金流量 ☆ example pp.169: Pt = 3 -1 + |（-10）| / 30 = 2.33 (years) ☆advantages vs. disadvantages:

  8. -- cont’ ◇decision rule ：多个方案比较时，投资回收期短的好；单个方案是否投资时，Pt≤T0。 ◇the feature of static payback • Return to Investment method ：通过计算项目投产后正常生产年份的投资收益率来判断项目投资的优劣。 -- formula : R = NB / K where，R is return rate to investment ，NB is the net income in normal year，K is total investment。 or: ARR = Average Net income / average book value of investment -- example -- decision rule ：多个方案比较时，投资收益率高的好；单个方案是否投资时，R≥R0。 -- advantages vs. disadvantages:

  9. --cont’ • Dynamic valuation method ☆ Net PV -- 净现值等于投资项目未来净现金流量的现值之和减去初始投资后的余额。 -- Formula : （Cumulative PV） 或： -- Decision rule ：多个方案比较时， NPV大的好；单个方案是否投资时， NPV≥0。 -- Example pp. 174 -- feature:

  10. -- continued ☆ 内部报酬率 （IRR, Internal Rate of Return ） -- 是通过计算使投资项目的累计净现值等于零使得贴现率来评价投资项目的一种方法。 -- 公式： 或： -- meaning of IRR：①投资的最低回报要求；②投资的机会成本 --decision rule ：多个方案比较时， IRR高的好；单个方案是否投资时， IRR ≥i0。

  11. -- continued -- example -- feature -- IRR的求解：用线性插值公式进行迭代 步骤：1) 任取r1=r0，计算NPV。 2) 若NPV<0, 取r2<r1；若NPV>0, 取r2>r1。 3) 检验|r2-r1|≤2%? 4) 若|r2-r1|≤2%，停止；否则，继续步骤2 。 5) 用线性插值公式计算IRR:

  12. -- continued -- Fig. NPV 0 IRR -- Feature:

  13. The Internal Rate of Return (IRR) Rule • IRR: the discount that sets NPV to zero 内部收益率：令净现值为零的贴现率 • Minimum Acceptance Criteria: 最低接受标准： • Accept if the IRR exceeds the required return. 如果内部收益率超过要求的收益率则接受 • Ranking Criteria: 排序标准： • Select alternative with the highest IRR 选择内部收益率最高的项目 • Reinvestment assumption: 再投资假设： • All future cash flows assumed reinvested at the IRR. 假设所有未来现金流量都以内部收益率进行再投资

  14. $50 $100 $150 0 1 2 3 -$200 The Internal Rate of Return: Example Consider the following project: 考虑以下投资项目： The internal rate of return for this project is 19.44% 项目的内部收益率为19.44%。

  15. IRR = 19.44% The NPV Payoff Profile for This Example If we graph NPV versus discount rate, we can see the IRR as the x-axis intercept. 在图中画出净现值和贴现率，内部收益率为净现值曲线与X轴的交点处贴现率。 贴现率 净现值 净现值 贴现率

  16. The Internal Rate of Return (IRR) Rule • Advantages: 优点： • Easy to understand and communicate 容易理解容易传达 • Disadvantages: 缺点： • Does not distinguish between investing and borrowing. 不能比较投资和借贷融资 • IRR may not exist or there may be multiple IRR 可能不存在内部收益率或者有多重内部收益率 • Problems with mutually exclusive investments 互斥投资所带来问题 • The Scale Problem. 规模问题 • The Timing Problem. 时序问题

  17. $200 $800 0 1 2 3 100% = IRR2 - $800 -$200 0% = IRR1 Multiple IRRs多重收益率 Which one should we use? 我们应该使用哪个？ There are two IRRs for this project: 该项目有两个内部收益率： 净现值 贴现率

  18. Mutually Exclusive vs. Independent Project互斥项目与独立项目 • Mutually Exclusive Projects: only ONE of several potential projects can be chosen, e.g. acquiring an accounting system. 互斥项目：潜在项目中，只可以选择一个，比如：只能应用一种会计系统 • RANK all alternatives and select the best one. 给所有备选项目排序，选择最佳的一个 • Independent Projects: accepting or rejecting one project does not affect the decision of the other projects. 独立项目：接受或拒绝一个项目不影响对其他项目的决策。 • Must exceed a MINIMUM acceptance criteria. 必须超过最低接受标准

  19. The Scale Problem规模问题 Would you rather make 100% or 50% on your investments? 你希望投资回报为100% 还是50%？ What if the 100% return is on a $1 investment while the 50% return is on a $1,000 investment? 如果投资$1，回报率为100%， 而投资$1,000，回报率为50%，应该怎么办？

  20. $10,000 $1,000 $1,000 Project A 项目A 0 1 2 3 -$10,000 $1,000 $1,000 $12,000 Project B 项目B 0 1 2 3 -$10,000 The Timing Problem时序问题 The preferred project in this case depends on the discount rate, not the IRR. 该例中，我们倾向选择哪个项目取决于贴现率，而不是内部收益率。

  21. 10.55% = crossover rate 交点处的贴现率 12.94% = IRRB 16.04% = IRRA The Timing Problem 项目A 项目B

  22. -- cont’ • Dynamic payback -- 是通过计算一个项目所产生的已贴现现金流量足以抵销初始投资现值所需要的年限，即用项目（投资）回收的速度来衡量投资方案的一种动态评价方法。 --动态投资回收期：是从项目投建之日起，用项目各年的已贴现现金流量将全部投资现值收回所需的期限。 -- 公式： Pt=累计贴现值开始出现正的年份 – 1 +（上年累计贴现值的绝对值 / 当年净现金流量的绝对值）

  23. --cont’ -- Example pp. 174 i = 15% year 0 1 2 3 4 5 6 7 NCF -5000 1300 1300 1300 1300 1300 1300 3500 PV -5000 1130.48 982.93 854.75 743.34646.36 561.99 1315.65 CNPV -5000 -3869.52 –2886.59 –2031.84 -1288.5 -642.14 -80.151235.5 Dynamic payback = 7 –1 + 80.15 / 1315.65 = 6.06 (years)

  24. 投资决策 –一个综合例子 [例1]某公司拟购入一台设备以扩充生产能力，现有甲乙两方案可供选择。甲方案需投资1000元，使用寿命为5年，采用直线法计提折旧，5年后设备无残值，5年中每年销售收人为600元，每年付现成本为200元。乙方案需投资1200元，用直线法计提折l日，使用后残值为200元，使用寿命也为5年，5年中每年销售收入为500元，付现成本第一年为300元，以后逐年增加修理费40元，另外垫支营运资金300元。假设所得税率为40%，试计算两个方案的现金流量。 先计算两个方案每年折旧额: 甲方案每年折旧额=1000／5=200(元) 乙方案每年折旧额=（1200-200）／5=200(元) 两方案的现金流量如下两张表所示：

  25. 投资项目现金流量计算表

  26. 如果每年营业现金净量不等，则计算投资回收期要根据每年年末尚未收回的投资额确定。如果每年营业现金净量不等，则计算投资回收期要根据每年年末尚未收回的投资额确定。 利用上例资料，分别计算甲、乙两方案的回收期。甲方案NCF相等，故: 甲方案回收期=1000／320=3.125(年) 乙方案NCF不相等，则有： 投资回收期法易于理解，计算简便，但存在明显的缺点，即没有考虑资金的时间价值，忽略了不同方案回收期满后现金流量变化情况，使方案评价、选择有片面性。

  27. （2）平均报酬率。 平均报酬率是投资项目寿命周期内的平均年投资报酬率，其常见的计算公式为: 利用上例，依前例1资料计算甲、乙两方案的平均报酬率如下： 该法不受建设期长短、投资方式、回收额等影响。其缺点是无法利用现金流量信息，但计算简单，可以作为方案评价的辅助性手段。

  28. 净现值法的决策规则: 在只有一个备选方案的采纳与否决策中，净现值为正时采纳，为负时不采纳;在多个备进方案的互斥选择决策中，应选净现值是正值中的最大者。 利用上例资料计算甲、乙方案净现值如下：

  29. 从以上计算可知，甲、乙两方案净现值都大于零，故都是可取的。但甲方案净现值大于乙方案，故大华公司应选用甲方案。从以上计算可知，甲、乙两方案净现值都大于零，故都是可取的。但甲方案净现值大于乙方案，故大华公司应选用甲方案。 净现值法优点是，考虑了资金时间价值，能反映各种投资方案的净收益，因而是一种较好的方法。缺点是不能揭示各个投资方案本身可能达到的实际报酬率的大小。

  30. 甲方案: i1=18%时,NPV1=320 * PVIFA(18%,5） – 1000 =320*3.127-1000 =0.64>0 i2=205时,NPV2=320 * PVIFA（20%,5） – 1000 =320*2.9906-1000 = - 43 <0 内部报酬率IRR1=18% + 0.64% / (0.64+43) *(20%-18%)=18.03% 乙方案NCF不等，因而，必须逐次测算。 按i=10%贴现率,测算NPV=86>0 再按i=12%贴现率,测算NPV=3>0 再按i=14%贴现率,测算NPV=-792<0. 用内插法，已知12%<IRR<14%， 从以上计算结果可知，甲方案内含报酬率较高，故甲方案的效益比乙方案好。 内含报酬率考虑了资金的时间价值，反映了投资项目的真实报酬，概念易于理解。但该方法的计算比较复杂，特别是NCF不相等时，需要经过多次测算才能求得。 3 + IRR 12 % *2%=12%+0.0075%=12.01% ＝ - - 3 ( 792 )

  31. 6.6 Sensitivity Analysis ☆ basic factors have been changed: -- price changes -- sales changes （growth or decline） -- interest （or discounted rate）changes -- tax changes -- cost changes ☆ Break – even analysis Break – even point

  32. --cont’ • The level of sales at break –even point -- 保本点销售收入： -- 保本点销售量 Q = F0 / [P(1-T) – b]

  33. -- cont’ -- sales for given goals ： -- given profit --given cash flow Cash Flow = Net profit + Depreciation

  34. --cont’ • Profitability Index (PI) rule PI = total PV of Future Cash Flow / Initial investment decision rule: -- for one project, if PI > 1, accept -- for mutually project, the larger PI is better

More Related