Project Finance & Investment Appraisal
Overview
Large projects in infrastructure, energy and real estate depend on careful appraisal and the right financing structure. This course covers investment appraisal techniques, project finance structures, risk allocation, financial modelling for projects and working with lenders.
Who should attend
Project and investment managers, financial analysts, bankers, and PPP unit staff.
Training methodology
Interactive presentations, practical exercises, case studies, group discussions, role-plays where relevant, and a personal action plan that participants apply in their own work.
Objectives
By the end of this course, participants will be able to:
- Apply investment appraisal methods to projects
- Understand project finance structures and parties
- Identify and allocate project risks
- Build and interpret project cash flow models
- Prepare projects for lenders and investors
Course outline
Day 1Investment Appraisal
- Cash flow estimation
- NPV, IRR and payback
- Cost of capital
- Sensitivity analysis
- Exercise
Day 2Project Finance Basics
- Corporate versus project finance
- Special purpose vehicles
- Parties and contracts
- Sources of funds
- Case study
Day 3Risk Allocation
- Construction and operating risks
- Market and revenue risk
- Political and currency risk
- Security and guarantees
- Risk matrix exercise
Day 4Project Financial Models
- Model structure
- Debt sizing and ratios
- Cash flow waterfall
- Scenarios
- Modelling exercise
Day 5Lenders and Investors
- Due diligence
- Term sheets
- Financial close
- Monitoring
- Action plan
