Using Genting Singapore (RWS) as the case

Case Study: Capital Budgeting Analysis

Assume you are a manager of a publicly traded company. You try to propose a potential real

world project for the company. The project could be either an original initiative based on

current operations/market opportunities, or a project under consideration by the company

(based on available information). Then you analyse the capital budgeting process for this

potential real-world project. If specific financial data is not available, develop realistic

hypothetical assumptions based on comparable projects or industry benchmarks. Present your

findings in a clear, professional format suitable for senior leadership decision-making.

Your report is expected to include the following components:

Project Background and Objectives: Describe the project's context, including its purpose, goals,

and strategic rationale.

Pro Forma Financial Statements: Develop pro forma financial statements, incorporating

estimated revenues, costs, depreciation, and tax impacts, etc.

Cost of Capital: Discuss the risk of the project and determine the project's cost of capital using

relevant parameters.

Capital Budgeting Evaluation: Appraise the project with proper capital budgeting methods.