COULD YOU PLEASE HELP ME TO DO THIS ONE

Description

Students are required to study, undertake a research, analyse and conduct academic work to the given instructions in the areas of business finance covered in learning materials 1 to 10 inclusive. The assignment should identify the main issues, including underlying theories, and explain financial performance measures used in your task. You are strongly advised to reference professional websites, journal articles and text books in this assignment (case study).

Required:

This assignment is to be completed in groups of 2 (3) students and is to be submitted in Week 10 of Trimester One.

This assignment should be completed in TWO PARTS:

1. Written Report should be completed in week 10.

80 marks

1. Oral Presentation during class in week 11.

20 marks

Further details will be given later in semester.

Key elements or milestones to be submitted in stages throughout the semester as per the schedule provided below. Feedback will be provided within one week of submission for each stage so that you can then amend subsequent sections if needed. MARKS will be subtracted for LATE SUBMISSION.

QUESTIONS

You are an investment adviser, working to build a foundation of wealth for your clients. One of your wealthiest clients already has a diversified portfolio, which includes managed funds, property, cash/fixed interest and a few direct share investments. She wishes to expand her portfolio and is considering companies’ shares to add to her portfolio. (The investor has an extra $1 million that wishes to invest into companies that operate on the ASX.) The company, which you will examine will be allocated to your group by Week 4.

Part A: Written Report and analysis of the firm’s performance (including referencing)

80 marks

• By the end of week 10 you should provide:

• A hard (and soft) copy of your report to your lecturer and

• A hard (or soft) copy to the other group members.

• You have one week to study the other group’s report (company) in order to debate with them during the following week’s (week 11) oral presentation.

You are required to do the following:

1. A brief description of the company

Prepare a brief description of the company, outlining the core activities, the markets they operate within and any factors in the companies’ history which you consider help present a “picture” of your company.

4 marks

1. Ownership-governance structure

Specify ownership-governance structure of the company:

• Name the main substantial shareholders:

• With higher than 20.00% of shareholdings. Based on this argument you should classify a firm as a family or non-family company, and

• With higher than 5.00% of shareholdings.

5 marks

• Name the main people involved in the firm governance:

• A Chairman

• Board members

• CEO.

• Whether any of these people has the same surname as any of substantial shareholders (>20% share capital). If yes- you could use this as an argument for the presence of an owner or family member(s) in the firm’s governance.

• Whether any of shareholders with more than 5% share capital is involved in firm governance.

5 marks

1. Financial Rations

Calculate the following key ratios for your selected company for the past 2 years. Annual reports are accessible via company websites (show all working out):

1. Return on Assets (ROA) = (NPAT / Total Assets)

Return on Equity (ROE)= (Net Profit After Tax / Owners Equity)

Gearing Ratio = Total Liabilities / Total Assets

EBIT x NPAT x TA = NPAT

TA EBIT OE OE

Be sure that you have “proven” the above equation.

15 marks

1. Be sure to explain why the ROE (EBIT) is significantly greater than or less than the ROA (EBIT).

5 marks

1. Capital Asset Pricing Model (CAPM)

Go on-line to http://www.reuters.com/finance/stocks/ and type in the code for your company into the Search Stocks field and click on the magnifying glass button. For market risk premium and the risk-free rate of return, you can find information from the following link. http://www.market-risk-premia.com/au.html

1. 1. Discuss the expected returns and risk (both systematic and unsystematic).

5 marks

1. 1. Calculate Expected Returns using the CAPM Model.

5 marks

1. 1. If the risk-free rate is 4% and the market Risk Premium is 6%, use the CAPM to calculate the required rate of return for the companies’ shares.

5 marks

1. 1. Is the company you and your partner have chosen a “conservative” investment? Explain your answer.

2 marks

1. Analysis of the gearing (leverage) ratio

Consider the gearing (leverage) ratios for your company over the past two years:

1. 1. Does it appear to be working towards the maintenance of a preferred optimal capital structure? (i.e., does it appear to be “stable”?) Explain your answer.

3 marks

1. 1. What have they done to adjust / amend their gearing ratio? Increase or repay borrowings? Issue or buy back shares? Has the Director’s Report given any information as to why they have made any adjustments?

6 marks

1. Dividend policy

   1. Discuss what the dividend policy of the management of the company appears to be. Explain fully.

6 marks

1. Letter of recommendation

Based on your analysis above, write a letter of recommendation to your client, providing an explanation as why you would like to include this company in their investment portfolio. Please refer to the ratio results calculated earlier and any other trends or factors that you believe to be important.

10 marks

1. Formal structure and referencing

4 marks

Part B: Oral Presentation (10min oral presentation and 5 min discussion)

(During class- Week 11).

20 marks

You are required to do the following:

• To make an oral power point presentation (in the SAME groups for the Written Report).

• Maximum ten slides (including introduction and conclusion slide).

• Assume you are in the stock market and you want to promote your company.

1. Provide a brief description of the company, outlining the core activities and any advantages which may help to convince the future investors to fund your firm.

• Explain if it is a family or non-family firm

5 marks

1. You should be prepared to argue against another group (thus, another company) in order to encourage market participants to buy securities of your company.

• Be confident during your speech

• Provide strong arguments for your company

• Use arguments from your analysis (report).

• Emphasise the strengths of your company

• Outline weaknesses of your competitor (the other company).

5 marks

1. Provide links between the theoretical concepts that we studied in this course and the practical issues that you can find out in the firm’s financial reports (information).

5 marks

1. Answer the questions of other market participants (audience) clearly.

3 marks

1. Provide a brief account of what you feel that you have learned from this analysis while undertaking this case study.

2 marks

GENERAL REQUIREMENTS

• The report must have an academic written structure including an introduction, body and conclusion.

• This assignment must be completed in groups of two students.

• Use numbers in the body of the essay (e.g. “6. Dividend Policy”).

• Provide an explanation on each of these topics and explain how they confirm the underlying theory, particularly related to the financial measures.

• You are only required to submit one assignment to StudentWeb.

• You are required to submit this assignment to Turnitin (one per group). Please ensure the similarity score is under 15%.

Presentation of written work

• Please submit your assignment on time.

• Please make sure that the names of all members (and student’s IDs), unit name and code are written on the cover sheet of the submitted assignment.

• You are required to use a Times New Roman font, size 12 point with 1.5 line spacing.

• Please insert page numbers into your assignment.

• Please use 3 cm margins.

• Submitted work should be your original work showing your creativity.

• Always keep an electronic copy until you have received the final grade for the Unit.

A high standard of work is always expected, so poorly presented work may be returned unmarked with a request to re-submit.

The rules apply for both electronic and hardcopy submission. When you submit your assignment electronically, please save the file as ‘assessment task 3.doc’.

Referencing

When writing your assignments, a reference must be included every time you use someone else’s ideas or information. In-text referencing ALL sources, whether academic books, journal articles, newspaper articles, material from the Internet etc., must be cited in the main text of the assignment itself. Harvard Style referencing is required for this assignment.

A reference must be included when you:

• Paraphrase (express someone else’s idea in your own words).

• Quote (express someone else’s idea in their exact words).

• Copy (financial statement, reproduce a diagram, graph or table from someone else’s work).

Example:

Ross, S., Trayler, R., Bird, R., Westerfield, R., & Jordan, B., (2019), “Essentials of Corporate Finance”, 5th Edition, Mc Graw Hill, Ltd, Australia.

Halili, E., Saleh, A., and Zeitun, R., (2015), 'Governance and Long-Term Operating Performance of Family and Non-Family Firms in Australia', Studies in Economics and Finance, vol.32, no.4, pp.398-421.

History of the ASX, viewed Mar 08 2023 , https://www.marketindex.com.au/history

Plagiarism, collusion and cheating

MIT regards most seriously any act of dishonesty in assessments such as plagiarism, collusion, cheating, re-submission of previously marked work in different units, examination misconduct and theft of other students’ work. http://www.mit.edu.au/about-mit/institute-publications/policies-procedures-and-guidelines/Plagiarism-Academic-Misconduct-Policy-Procedure. For further information, please refer to the Academic Integrity Section in your Unit Description.

In short:

‘Plagiarism’ means to take and use another person’s ideas and pass these off as your own by failing to give appropriate acknowledgement, that is, not indicating by referencing that the ideas expressed are not your own.

‘Collusion’ (or unauthorised collaboration) means joint effort in preparing material submitted for assessment, between students or others, except where this has not been approved by the lecturer in charge of the unit.

‘Cheating’ means to obtain an unfair advantage in an examination or in other written or practical work required to be submitted or completed by a student for assessment. If the passing off was done intentionally, you have cheated; if it was unintentional, the offence you have committed is the academic misdemeanour of failing to reference a source correctly.

Acts of dishonesty in assessment could result in penalties including failure in the Unit and possible exclusion from MIT. If you are unsure about this, please speak to the Unit co-ordinator/lecturer.

Concluding Notes:

Working in groups has its pros and cons. I am sure that you will work enthusiastically and constructively in your groups. In cases of disagreement, you will be able to solve them in a professional and rational manner. Open and constructive communication always has positive impact on team work. There could be time when you may have to agree or disagree with each other. However, if you are unable to resolve issues, you are very welcome to see me and we will work together to sort the problem out. I believe you can learn a lot by discussing different issues with your colleagues.

GOOD LUCK!