Financial Analysis

FINANCIAL ANALYSIS
|ENTREPRENEURSHIP DEVELOPMENT|
Nishant Mouray-108
Rohit Sharma - 204
Vinay Kumar Yadav-
149
Nikhil Kaira-053
Abishek Choudhary
-153
Financial analysis is used to evaluate economic trends,
set financial policy, build long-term plans for business
activity, and identify projects or companies for
Financial Analysis investment.
Any new venture needs financing and hence,

entrepreneurs have to decide where to get funding from,
how to invest, and how much to borrow and hence,
financial analysis plays an important role in decision
making
Financing the Project
The process of development of a project consists of 3 stages:
• Pre-bid stage:
A private sector company is invited through govt tenders to take charge of the project as a private-sector sponsor. The
sponsors then assesses the viability (ability to succeed) of the project.
• Contract negotiation stage:

The project participants negotiate and formalize agreements defining the technical, economic, and commercial outlines of
the project.
• Fund-raising stage:
The money-raising stage begins once all project agreements are initialed and end at the time the facility is built and
commissioned. At this stage, the sponsor mobilizes the required financing and supervises the management organization,
construction, and successful commissioning of the facility.
WHAT IS PROJECT FINANCING?
Project Finance deals with financial aspects related to a particular

project that involves analyzing the feasibility of a project and its
funding requirements on the basis of the cash flows that the project is
expected to generate, if undertaken, over the years.
The following are key • Risk Sharing:
features – The company shares the risks associated with the project failure with the
other participating entities by keeping the project off the balance sheet.
• Involvement of Multiple Parties:

As the projects are large and capital extensive, multiple parties often provide
capital in the form of debt or equity.
• Better Management:
As the whole project is a different entity in itself, often, a dedicated team is
assigned to look after the completion of the project, which results in better
efficiency and output.
STAGES OF PROJECT FINANCING
ENTREPRENEURSHIP DEVELOPMENT
SOURCES OF FINANCE
• Finance is significant for business because it cannot carry out its operations even
for a single day without finance.
• The selection of source depends upon the number of funds required, nature of
business, repayment period, debt-equity mix, etc.
• The selection of sources also depends upon the purposes for which funds are
needed.
A firm can obtain funds from a variety of sources,which may be classified as
follows:
• Long-term Sources
• Medium-term Sources
• Short-term Sources
• Owned Capital
• Borrowed Capital
• Internal Sources
• External Sources
VENTURE CAPITAL SOURCES
Venture capital is a form of private equity and a type of financing that investors provide to
startup companies and small businesses that are believed to have long-term growth
potential. In other words, Venture capital provides long-term, committed share capital, to help
unquoted companies grow and succeed.
ENTREPRENEURSHIP
DEVELOPMENT
SOME OF THE SOURCES ARE:-
• The private person having wealth. • By Banks
• Pension Fund, trust, Insurance • Private Sector Companies

Company, banks, etc.
• Equity capital
• All India Financial Institutions
• Conditional Debt
• By State Finance Corporation
• Income Note
INVESTMENT PROPOSAL
• In simple terms, an investment proposal is a text document, PDF, or slide

show presentation about a startup (let's say a product or service) whose
purpose is to raise capital.
• It appeals to people who have money and may be interested in

contributing financially.
• It is the driving tool during a meeting with potential
investors.
• It's a presentation that covers critical company information

and metrics, hoping to get investors interested in funding a
company, product, or project.
• The best investment proposal for business will present data

in terms of ROI.
ENTREPRENEURSHIP
DEVELOPMENT
WHAT DO INVESTORS LOOK FOR IN
AN INVESTEMENT PROPOSAL?
Investors look for To look if they can Plan in generating Ensure if the Check the position of
companies that can generate significant Income by including proposal has a solid the company in the
grow quickly and profits beyond the multiple sources of business plan, a clear market.
manage the high initial product idea revenue. investment structure.
growth scale. with adequate
financial projections.
OUTLINE FOR A VENTURE CAPITAL
PROPOSAL
• Executive Summary: Brief outline of the Company's Purpose and
goals.
• Opportunity: Description about the general nature of the company
• Products/Service/Industry: Details about the products, services provided

and Industry involved should be mentioned
• Market Analysis: Potential market size and growth rate
• Sales Strategy: Summary of company's startegy to bring their

product/service to market
ENTREPRENEURSHIP
DEVELOPMENT
• Competition
• Technologies/Special Know-how:
• Outlook/Benchmarks/Timelines
• Exit Strategy
• Financial Performance
• Current Investors
• Financing
SOURCES OF FINANCE FROM DIFFERENT
BANKS
• Banks are an important source of working capital.
• They provide a wide variety of loans tailored to meet the specific requirements of an
industrial unit.
• Bank financing is the most traditional financing method and is usually the first thought
people have when they consider funding their business.
• Banks can finance business operations in a number of ways.
The Banks provide financing in the
following ways:
• Bank Loans • Bill Discounting
• Cash Credits • Packing Credit
• Overdrafts • Security for Assistance

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FINANCIAL ANALYSIS

Any new venture needs financing and hence,

• Contract negotiation stage:

Project Finance deals with financial aspects related to a particular

• Involvement of Multiple Parties:

• The private person having wealth. • By Banks

• Pension Fund, trust, Insurance • Private Sector Companies

• In simple terms, an investment proposal is a text document, PDF, or slide

• It appeals to people who have money and may be interested in

• It's a presentation that covers critical company information

• The best investment proposal for business will present data

• Opportunity: Description about the general nature of the company

• Products/Service/Industry: Details about the products, services provided

• Market Analysis: Potential market size and growth rate

• Sales Strategy: Summary of company's startegy to bring their

• Banks are an important source of working capital.

• Banks can finance business operations in a number of ways.

• Bank Loans • Bill Discounting

• Cash Credits • Packing Credit

• Overdrafts • Security for Assistance

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