Diamond Chemicals: Merseyside and Rotterdam Project Investment decision analysis Group Name- fInatics Group Members- 1. Nishant Kumar (MP13037) 2. Rahul Naredi (MP13039) 3. Samardarshi Sarkar (MP13046) 4. Shadab Akhtar (MP13050) Summary About the case Diamond Chemicals is a leading producer of polypropylene, the polymer used in a variety of products (ranging from medical products to packaging film, carpet fibers, and automotive components) and is known for its strength and
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Diamond Chemicals PLC Executive Summary Diamond Chemicals is considering two mutually exclusive projects, the Merseyside project and the Rotterdam project, for the production of polypropylene When considering the Merseyside project, senior-management wants a positive impact on earnings per share. The addition to earnings per share was £28,800 with an average addition of £2,000 per year2. Calculated with erosion, the addition to earnings per share was £18,800 with an average addition of £1
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------------------------------------------------- Diamond Chemicals: The Merseyside and Rotterdam Projects Valuation and Recommendation | Table of Contents Executive Summary2 Problem Statement & Issues3 Analysis of Merseyside & Rotterdam3 The Merseyside Proposal & Analysis3 Static NPV4 Option to Switch to Japanese or German Technology4 The Rotterdam Proposal & Analysis5 Static NPV5 Option to Switch to German Technology5 Qualitative Considerations6 Recommendation7 Appendix I – Black-Scholes
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Teletech Case After careful review of the Teletech case I think that Rick Phillips thought on the method to calculate hurdle rate or WACC is the most aligned with industry standards and would be the most financially beneficial to the company overall. The current method that Teletech Corporation is using for hurdle rate is an overall average for the company; all segments combined using an averaged beta for the company, regardless of the risk of each division. If the companies risk level was very
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Analysis Diamond Chemicals Introduction This project belongs in the engineering-efficiency category; therefore, it has to fit at least 3 of 4 performance hurdles, which are 1. Impact on EPS; 2.Payback; 3.Discounted cash flow and 4. Internal rate of return. In this article, some of those involved explained and described their opinions; however, professional knowledge may have been lacking. Therefore, we will expound and clarify below. Management Analysis Capital Expenditure On the surface
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1. What changes, if any, should Lucy Morris ask Frank Greystock to make in his discounted cash flow (DCF) analysis? Why? What should Morris be prepared to say to the Transport Division, Director of Sales, her assistant plant manager and the analyst from the Treasury Staff? • In DCF analysis if Merseyside Project done by Greystock, inflation rate is assumed to be 0%, which is not the case in practice. Treasury staff showed concerns that long-term inflation should be 3%. • Since preliminary engineering
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Case 3: Diamond Chemicals Diamond Chemicals operates two large polypropylene production plants, the Merseyside Works in England, and the other in Rotterdam, Holland. Diamond Chemicals’ plant manager Lucy Morris is currently examining a (British Pounds) 9 Million project to improve the plant, which has been under scrutiny for poor financial performance. Morris has assumed the responsibility of Merseyside Works, and has decided improvements need to be made. Although there is room for substantial
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Based on the discussion with other divisions and teams, we believe that there are several adjustments to be made. First, with regard to the Transport Division’s memorandum, we determined that the charge for the use of excess rolling stock is non-material and the higher utilization rate is actually good for overall efficiency. It is, however, proper to allocate the accelerated schedule to purchase new rolling stock attributable to this project to the capital budget. We do so in the amount of $2 million
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from Latin: carbo "coal" is the chemical element with symbol C and atomic number 6. As a member of group 14 on the periodic table, it is nonmetallic and tetravalent—making four electrons available to form covalent chemical bonds. There are three naturally occurring isotopes, decaying with a half-life of about 5,730 years. Carbon is one of the few elements known since antiquity. There are several allotropes of carbon of which the best known are graphite, diamond, and amorphous carbon. The physical
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JUNIOR 1 S Y 2000 - 2 0 0 1 V o l . 20 N o . 1 C O N T E N FOR LOVE OF DIAMONDS These brilliant gems are not only for fashion but find many uses in other industries as well. CHEMISTRY: BUILDING BLOCKS OF MODERN CIVILIZATION Understand the significance of chemistry throughout man’s history. NUCLEAR CHEMISTRY: TOWARDS A SAFE ENERGY SOURCE Is nuclear technology a boon or bane of science? Read on. T S ib er s, De ar BB su bs cr ng ga zin e is ma ki Ba
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