Académique Documents
Professionnel Documents
Culture Documents
By
Pegasus(Team No. 2)
Team Members:
PiyushSamaria : piyushsmr2@gmail.com
Rishab Bucha : rishab1203@gmail.com
In d ex
Market scenario
Valuation
n through the development of Islamic economics. Sharia prohibits the payment or acceptance of interest fees for loan
.
slamic banking was undertaken in Egypt under cover without projecting an Islamic image in 1963.
oject became part of Nasr Social Bank which, currently, is still in business in Egypt and is the largest Islamic bank in
countries
*
Seyad Shariat Finance Limited
qOne of the entity of Syed shariat Limited, Others being Seyadu Beedi,Seyad Cotton Mills etc.
qSyed shariat currently works in Leasing, Hire purchase & Venture Financing, Housing and other loans
for Rural Area.
LEASING
This permits the company to lease automobiles, equipment, machinery and other business assets
to a lessee on agreed rentals payable every month.
TRUST FINANCE
In trust finance business capital is provided by the company and the profits are shared by the client
and the company according to the contractual terms and conditions.
HOUSING FINANCE
Under this scheme, the Company will provide finance for the construction of houses for the
clients on the basis of Rental Sharing Scheme.
VENTURE FINANCE
Under the Joint venture agreement the Company advances funds and participates in the
capital. The income is determined as a percentage of turnover.
Analysis of Islamic Banking
Strength Weakness
Opportunity Threats
Ø“Islamic” bank may have to suffer from the negative perception of terroris
population who can use the facility
Communalization
people follow Sharia law and Øhence can deal onlyofwith
finance sector
Islamic in terms of sharia and non sharia bank
banks
the niche segment
Flow of credit to Muslims by Banks
nalyzed the three nearby state and the state of bank credit availability for Muslims.
a also has low score on both the parameters but is excluded due to the recent judgement given by Kerala High Court
ash flow to firm as the model for estimation of the value of firm.
of IPO is to allow the firm to open additional branches and raise additional capital for operations
m:-
et target for number of branches to be opened is assumed.
nalyze branch wise profitability and then bring the change in the balance sheet and income statement and final cash
sumption of stable growth after year 6
The number of employee figure is taken from the K. Ahamed Hussain,ranch Manager,Tirunvelli.
Interest expense from the profit given out in last 3 years (8.2, 7, 9.5)
Profit estimated per branch come out to be 36,46,000 for an year with added asset base for 5.2 crore per branch
P & L of Branch
Projected income statement
qWe project the future income statement for the next 5 years.
qThe scope of activity of the bank is assumed to be same of leasing and buy-hire model.
qBonus payment (read interest payment) assumed at 8.5 % over time
qFirms D/ E range from -3.6 to 7.8 with most firm having D/E of .6
qOur firm has a D/E of ~ .89
qEstimating de leveraged beta we obtain Beta for our firm as:-
Beta(Unlevered) = (1.43 * .6)/1.6 = 0.33
Beta Firm = Beta Unlevered * (1 + .89) = 1.98 ~ 1.1
Free cash Flow to Firm Analysis
qAssumption of terminal growth at 4 %
qCost of debt as the payment for borrowing i.e 8.5 %
qUse of CAPM model for cost of equity
qWACC to be 10.30 %
WACC
4.00 49 . 70 47 . 67 47 . 08 45 . 40 43 . 41
e band for investor lie between first and second band and it is here that about 50 % of stock lie which have similar bo
in the range and hence should be attractive for investors.
References
qSocial, economic and educational status of Muslim in India, by Prime Minister committee 2008
qProwess database for stock related details
qSeyad Shariat annual report, 2007, 2008, 2009,
qAswath Damodaran on Valuation
qAswath Damodaran on Evaluation of Finacial services
qTelephonic interview was done for Mr K. Ahamed Hussain - Deputy General Manager,
qProvided information on staff and operation
qProfit % paid over the period
qFuture plan of the firm
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Questions?????
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