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    Project Finance-Modelling and Analysis: A. Finance Is Defined As The Management of Money and Includes Activities

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    DILIP KUMAR
    This document discusses project finance modeling and analysis. It defines finance and accounting, and outlines the key skills required for a finance professional, including analysis, decisiveness, and mathematical expertise. It then defines project finance as the funding of long-term infrastructure projects using non-recourse or limited recourse debt paid back from project cashflow. It provides 20 related project finance terminologies and discusses how non-recourse loans work as well as mezzanine financing. Finally, it outlines sectors that are well-suited for project financing, such as construction, mining, energy, and highways, as they require large investments but lack high-value collateral.

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    Project Finance-Modelling and Analysis: A. Finance Is Defined As The Management of Money and Includes Activities

    Uploaded by

    DILIP KUMAR
    22 views3 pages
    This document discusses project finance modeling and analysis. It defines finance and accounting, and outlines the key skills required for a finance professional, including analysis, decisiveness, and mathematical expertise. It then defines project finance as the funding of long-term infrastructure projects using non-recourse or limited recourse debt paid back from project cashflow. It provides 20 related project finance terminologies and discusses how non-recourse loans work as well as mezzanine financing. Finally, it outlines sectors that are well-suited for project financing, such as construction, mining, energy, and highways, as they require large investments but lack high-value collateral.

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    Project finance report

    Original Title

    module 01

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    This document discusses project finance modeling and analysis. It defines finance and accounting, and outlines the key skills required for a finance professional, including analysis, decisiveness, and mathematical expertise. It then defines project finance as the funding of long-term infrastructure projects using non-recourse or limited recourse debt paid back from project cashflow. It provides 20 related project finance terminologies and discusses how non-recourse loans work as well as mezzanine financing. Finally, it outlines sectors that are well-suited for project financing, such as construction, mining, energy, and highways, as they require large investments but lack high-value collateral.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    22 views3 pages

    Project Finance-Modelling and Analysis: A. Finance Is Defined As The Management of Money and Includes Activities

    Uploaded by

    DILIP KUMAR
    This document discusses project finance modeling and analysis. It defines finance and accounting, and outlines the key skills required for a finance professional, including analysis, decisiveness, and mathematical expertise. It then defines project finance as the funding of long-term infrastructure projects using non-recourse or limited recourse debt paid back from project cashflow. It provides 20 related project finance terminologies and discusses how non-recourse loans work as well as mezzanine financing. Finally, it outlines sectors that are well-suited for project financing, such as construction, mining, energy, and highways, as they require large investments but lack high-value collateral.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    PROJECT FINANCE- MODELLING AND ANALYSIS

    A. Finance is defined as the management of money and includes activities


    such as investing, borrowing, lending, budgeting, saving, and forecasting.

    Finance deals with the questions of how and why an individual, company or
    government acquires the money needed - called capital in the company
    context - and how they spend or invest that money.

    Accounting is keeping track of transactions made during receiving and


    spending. This is the core difference between the finance and accounting.
    The basic points required to pursue a career in finance

    Skills Required for a finance professional :

    1. Analysis
    2. Decisiveness
    3. Persuasiveness
    4. Interpersonal and communicational Skills
    5. Mathematical Expertise

    Project finance: Project finance is the funding of long term


    infrastructure, industrial projects and public services using a non
    -recourse and limited recourse financial structure . the debt and equity
    used to finance the project are paid back from the cashflow generated by
    the project .

    Project finance in simple words, financing the project on non-course


    financial structure whereas the corporate finance is financing the
    corporate based on their financial statements and taking collateral
    (security) as their assets.
    20 terminologies related to project finance
    1. Amortisation
    2. Advance payments
    3. Annuity
    4. Commissioning
    5. Contingency
    6. Concession agreement
    7. Deficiency agreement
    8. Financial close
    9. Feasibility study
    10.Build Operate Transfer (BOT)
    11.Working capital
    12.Loan to value ratio
    13.EPC contract
    14.Design-Bid-Build (DBB)
    15.Public- Private partnership (PPP)
    16.Floating currency
    17.Joint Operating Agreement (JOA)
    18.Environmental Risk
    19.Hedge Funds
    20.Insolvency

    A. Non- recourse loan is a type of loan secured by collateral. which is


    usually property. I the borrower defaults the issuer can seize the collateral
    but cannot seek out the borrower for any further compensation even if the
    collateral doesn’t cover the full value of the defaulted amount. Non
    recourse are harder to obtain and qualify for because he lender takes the
    majority of Risk

    Mezzanine Financing :mezzanine financing is a hybrid of debt and


    equity financing that gives the lender the right to convert to an equity
    interest in the company in case of default
    Project finance suits:
    The sectors or a project which suits the project finance
    are construction of high valued buildings, mining industry, entertainment
    industry like sports and other possible activities, energy industry,
    highway development projects. These are suitable because these require
    high amount of investment and no such high valued collaterals can be
    sourced as securities, thus project finance is the only way to finance the
    project and also get the repayment from the cash generated from the
    project.

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