7. Financial Modeling
• Start-up Financial Models
• Corporate Financial Models
• Project Finance Models
• Stochastic Models
Financial modeling is the process of estimating the financial performance of a
project or business by taking into account all relevant factors, growth and risk
assumptions, and interpreting their impact
9. Project Finance
• SPV: Special Project Vehicle.
• Non or Limited Recourse.
• Maximize Leverage.
• Off-the Balance Sheet Treatment.
• Capital Intensive.
Project Finance is the financing mechanism whereby a lender relies
on the cash flow of a free-standing asset
10. Flow of Typical Business or Project
• Feasibility
Market research, Economic factors &
business risk
• Funding
Investing in the business [loans, equity]
& cost of financing
• Use of Funds
Operating Assets, working cash
& capex
• Operations
Business model, Revenue &
Cost
• Profit
Efficiency management of
resources
• Cash
Base for evaluating investment
& Business
11. Flow of Project Finance
Supplier
OFFTAKERS
INDUSTRIAL CUSTOMER 1
INDUSTRIAL CUSTOMER 2
Supply Contract (s)
Sponsor
entity[%]
Other Investors
PROJECT SPV
INDUSTRIAL CUSTOMER 2
Supplier
Contract
Drawdowns
Assignments
Debt Service
LENDER’(S)
Loan & Financing Agreements
Key Contracts / Agreements
Funds Flow
Collections Account
Other Reserve Accounts
EPC Contractor,
Opex
EPC Contract
Payment for Supplies
Operations Account
Debt Service Reserve
Account
Distribution Account