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Feasibility Study For Project Financing Blog
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Viola Funding Limited offers a comprehensive services in the field of investment engineering, project financing and consulting, including the development of feasibility study for project financing and investment projects in the energy sector, mining, oil and gas sector, heavy industry, environmental protection, infrastructure, agriculture and other industries. Our team always demonstrates competence, commitment to the interests of customers, high reliability and a professional system approach.
In investment engineering, a high-quality feasibility study lays a foundation for the rational allocation of financial or other resources, protecting the business from making unreasonable decisions.
Check out our investment services and contact Viola funding Limited to learn more about the benefits offered for your project.
Goals and stages of the feasibility study for project financing
In this context, it is important to draw up a schedule and budget, determine the composition of the project team responsible for the preparation and implementation of the project. The latter usually includes specialists from different fields, because any large investment project is interdisciplinary and structurally complex.
The main goal of conducting a feasibility study for project financing is for a comprehensive analysis of the facility in terms of the feasibility of its construction and operation.
The completeness and validity of the recommendations are the most important benefits of a feasibility study for large investment project.
Preparing such a document reduces the risk of missing important aspects of the project. In addition, the feasibility study allows the business to choose the best option for the implementation of the planned project, so it is recommended to involve a wide team, including independent experts and representatives of all stakeholders.
The most important disadvantage of the feasibility study is the complexity, long execution time and high cost, which contributes to an increase in the number of cases of insufficient and superficial pre-project analysis. Sponsors and other participants in large investment projects should be aware that unjustified savings or ignoring this stage can result in huge losses in the next stages.
Conducting a feasibility study: main approach
The technical part of the feasibility study considers the existing and potential engineering problems of the project, which determine the possibilities for achieving the goals of the participants. The general logical formula of this part of the document is based on the fact that the proposed engineering solutions respond to the identified problems of participants and partners.
Feasibility study for project financing contains separate elements in which the project is analyzed from different aspects.
The technical feasibility of a project can be described by a matrix that represents the mechanism of intervention through the project into the current state of the business / social environment. It is also important to indicate the ways and specific tools that can support the project in the operation phase, and not just effectively carry out the investment phase.
The analysis of financial stability is aimed at checking the assumption that the allocated financial resources are sufficient to cover all financial expenses during the entire reporting period.
The financial viability of the project is confirmed if the cumulative net cash flow is not negative in any of the analyzed periods of work. Financial stability should be checked in relation to the financial position of the investor and operator of the object being created.
Thus, the financial analysis of an investment project will focus on assessing the return on investment and net present value, as well as checking the financial sustainability of the project and the beneficiary/operator. On the other hand, the economic analysis of the project in the framework of the feasibility study is carried out in terms of benefits for the project participants and is based on an assessment of these benefits, while taking into account the parameters obtained as a result of the financial analysis of the project.
Feasibility study for a large project: an example
Business idea and a brief history of the development of an investment project. Market analysis and the concept of bringing the product to the market. The general concept of providing the enterprise with raw materials, energy, fuel and auxiliary materials (includes the specification of raw materials, energy carriers and auxiliary materials and sources of supply, the required quantity and quality). Production capacity, working time and production plan. Specification of the finished product.
Other items of economic and financial analysis include project sensitivity analysis, analysis of risk factors and their impact on the project, assessment of the workload of the facility under certain conditions, as well as its impact on the planned performance indicators.
The feasibility study of project financing ends with conclusions in the form of a professional opinion and recommendations for the project team.
In particular, the study should contain recommendations on the choice of the type of equipment and production processes, the cost of the project and sources of financing, the achievement of planned indicators, risk management, etc.
Feasibility study and other investment engineering services
The investment of large capital is always preceded by a feasibility study of the investment project.
This stage plays a key role in the investment process, since the more information investor receives about the future enterprise, the less risks there will be at the project implementation stage.
The start of the investment process requires a long period of negotiations, approvals, checks and reviews, which are based on the conclusions of the feasibility study and the recommendations of experts.
Feasibility studies for a project in the energy sector, infrastructure, industry or other sectors have many specific aspects, which require the involvement of a multidisciplinary team of specialists in finance, law and engineering.
Viola Funding Limited offers flexible long-term loans for large projects with maturities up to 20 years.
We participate in the organization of project finance (PF) schemes, offer bank guarantees and loan refinancing, and provide investment engineering and consulting services.
Among our services:
• Financial analysis and modeling.
• Analysis of the attractiveness of investment projects.
• Conducting a feasibility study for large investment projects.
• Development of an investment business strategy.
• Writing an investment memorandum.
• Complex examination of projects.
• Project management, etc.
Our company, together with leading engineering firms and international manufacturers of industrial equipment, is ready to offer comprehensive services in the field of construction or modernization of capital-intensive facilities under an EPC contract.
If you are looking for a reliable and experienced general contractor, please contact our specialists.
eMAIL:[email protected]
Website:https://viola-funding.com
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