if project

International Finance

Group MembersKomal SarfrazS2F14MCOM0005

Ambreen NazeerS2F14MCOM0012

Project This project is about to make investment in International market, So we want to see which sector makes our investment profitable. We will calculate net present value of three cement companies of dubai and decide whether to invest or not. Cash flows are founded from sales projection and exchange rate is taken from net.

Selected Companies

• Jebel Ali Cement• Black rock Cement UAE• National Cement Company

Introduction of Jebel Ali cement

We are leading manufacturer and supplier of cement, based in Dubai Arab Emirates. Our products provide strength and durability to the booming construction industry and help facilitate the rapid growth and economy of the region. Jebel Ali cement represents high quality, dependability and technical excellence. We are commited to providing products and services of the highest international standards based on global expertise, trust and professionalism . At Jebel Ali cement, we consistently maintain our high standards in a highly competitive market by engaging professionals who are the best in their respective fields by improving processes, introducing new products , fostering long term relationships with both our personnel as well as our clients and always delivering on our promises.

Mission StatementTo deliver high quality to our customers at competitive prices, while maintaining strong relations with them through all times.

Vision StatementAt jebel ali cement, we are focused on achieving a leading industry position through our long term commitment to supply consistently superior quality products and services based on global expertise, trust, professionalism and respect for our environment.

Our Values

Values are how any company will value its stakeholders , its staffs, its customers, its suppliers and its environmentEach and every member of the company needs to understands these values and apply them in the daily operations.

Sales of Jebel Ali Cement

2010 4902396

2011 5788302

2012 11523050

2013 15967900

2014 17532277

2015 18642358

Annual Growth rate of Jebel Ali

2011 18.07%

2012 99.07%

2013 38.57%

2014 9.80%

2015 6.33%

Average Growth rate of Jebel Ali

18.07%+99.7%+38.57%+9.80&+6.33%/ 5

=34.368%

Sales for next years of Jebel Ali

2016 25055329.2

2017 33674362.4

2018 45258343.1

2019 60827213.1

2020 81751774.4

Cost of sales for Jebel Ali

2010 32928712011 39195402012 84546002013 108874272014 114481422015 11615261

Annual Growth rate of CGS

2011 19.03%

2012 115.7%

2013 28.78%

2014 4.90%

2015 1.46%

Average Growth rate of CGS

19.03%+115.7%+28.78%+4.90%+1.46%/ 5

=33.97%

Cost of sales for next years

2016 15560965.2

2017 20847025.1

2018 2792875.5

2019 37416149.1

2020 50126428.4

Cash flows of Jebel Ali

2016 9494364

2017 12827337.3

2018 17329583.6

2019 23411054

2020 31625346

Calculation of NPV2015 2016 2017 2018 2019 2020

Initial Investment

1379815

- - - - -

Cash flows

- 9494364

12827337.3

17329583.6

23411054

31625346

Exchange rate

- 28.15 28.15 28.15 28.15 28.15

Translated amount

- 337277.6

455678.1

615615.8

831653.8

1123458.1

Discount Rate

- 14.76% 14.76% 14.76% 14.76% 14.76%

Discount factor

- 114.76/100 =1.1476

(1.1476)2 =1.3169

(1.1476)3 =1.5114

(1.1476)4

(1.1476)5

Present value

- 293898.2

346023.3

407314.9

479477.5

564409.9

Continued…

NPV= PV- Initial Investment = 2091123.8 – 1379815 = 711308.8

Introduction of Black rock Cement

Black Rock Cement FZC is a cement trading company based in the United Arab Emirates. It specializes in supplying cement, white cement and clinker to Sub-Saharan Africa.

The company's Black Rock brand cement is manufactured under licence by a leading cement company in Pakistan. The product is a high-end variant and attracts a premium in the retail market. The cement conforms and exceeds the European, British, ASTM and South African standards in it's class.

The main products supplied by Black Rock are Ordinary Portland Cement 42.5 N, White Portland Cement and clinker. -

To be the preferred supply chain partner to cement and construction companies in

Africa.

Mission Statement

Vision StatementHelping build Africa in our own small way.

Sales of Black Rock Cement

2010 2198443

2011 2220360

2012 2930152

2013 2361192

2014 2182327

Annual Growth Rate of Black rock cement

2011 0.996%

2012 31.97%

2013 -19.42%

2014 -7.58%

Average Growth rate of Black rock cement

0.996%+31.97%+(-19.42)%+(-7.58)% / 4

= 1.4915%

Cost of Sales of Black rock Cement

2010 2131027

2011 2278304

2012 2633210

2013 1875679

2014 1500312

Annual Growth Rate of CGS

2011 6.91%

2012 15.6%

2013 28.8%

2014 -20.01%

Average Growth Rate of CGS

6.91%+15.6%+28.8%+ (-20.01)%/4

= 7.825%


I.investment

20000000

- - - - -

Cashflows

- 597057.3

503385.8

400287.6

286993.3

162672.96

Exchange rate

- 28.25 28.15 28.15 28.15 28.15

Translated amount

- 21209.9

17882.27

14219.81

10195.14

5778.791

Discount rate

- 15.21% 15.21% 15.21% 15.21% 15.21%

Discount facror

- 115.21/100 =1.1521

(1.1521)2 =1.3273

(1.521)3 =1.5292

(1.1521)4 =1.7618

(1.1521)5 =2.0298

Present value

- 211184097.7

32213472.67

22929878.6

25578617.7

4322846.96

Continued…

NPV = PV- Initial Investment = 156228973.6 – 20000000 = 136228973.6

The company was established in 1968 under the guidance of the late ruler of Dubai H.H.Sheikh Rashid. It was his vision to create new avenues for industry using local resources and local raw materials. Accordingly ,National Cement was set up to produce the base material to fuel the anticipated construction boom in the UAE and the region.National Cement primarily servers the UAE and GCC markets with an array of branded cement products.

Overview of National Cement Co.

Mission StatementTo supply products that are leaders in Quality, Cost and Customer Satisfaction through the integration of people, technology and systems.

Vision StatementTo become the Leader Industrial Group in the region by being the front runner in all sector we operate in and position in the enterprise competitively in the dynamic Global Business Environment.

Sales of National Cement Co.

2010 2902684

2011 3304272

2012 4342634

2013 4588064

2014 4723814

Annual Growth Rate of Sales

2011 13.84%

2012 31.42%

2013 5.651%

2014 2.96%

Average Growth Rate of Sales

13.84%+31.42%+5.65%+2.96%/ 4= 13.47%

Sales for next years

2015 5360111.7

2016 6082118.7

2017 6901380.1

2018 7830995.9

2019 8885831.0

Cost of Sales of National Cement Co.

2010 2549953

2011 2698348

2012 3376972

2013 3533514

2014 3646595

Annual Growth Rate of CGS

2011 5.82%

2012 25.15%

2013 4.64%

2014 3.20%

Average Growth Rate

5.82%+25.15%+4.64%+3.20% / 4= 9.7025%

Cost of Sales for next years

2015 4000405.8

2016 4388545.2

2017 4814343.8

2018 5281455.5

2019 5793888.7


I. Investment

108224.2

- - - - -

Cash flows

- 1359705.9

1693573.5

2087036.3

2549540.4

3091942.3

Exchange rate

- 28.15 28.15 28.15 28.15 28.15

Translated amount

- 48302.16

60162.5

74139.8

90569.8

109838.1

Discount rate

- 51.73% 51.73% 51.73% 51.73% 51.73%

Discount factor

- 1.52 2.3104 3.51 5.34 8.11

Present value

- 31777.7

26039.9

21122.5

16960.6

23543.5

Continued…

NPV = PV – Initial Investment = 119444.2 – 108224.2 = 11220

ConclusionCalculation of NPV is positive so we can invest in Dubai and introduce a new cement industry and we can earn profit in future.

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