- •Abstract
- •1. Introduction
- •1.1. Background
- •1.2. Problem and research questions
- •1.3. Aim and Limitation
- •1.4. Outline of thesis
- •1.5. Abbreviation and definition
- •Irr Internal Rate of Return
- •2. Method
- •2.1. Approach
- •2.2. Data collection method
- •2.3. Primary data
- •2.4. Secondary data
- •2.5. Data processing
- •2.6. Validity, reliability and generalization
- •3. Theories
- •3.1. Principal-Agent Problems
- •3.2. Wacc and opportunity cost of capital
- •3.3. Capm and apt
- •3.4. Estimating β
- •3.4.1. Operating leverage and β
- •3.5. The risk and discount rates for international projects
- •3.6. Purposes of performance measurement
- •3.6.1. Eva, Book roi, and ep
- •3.7. Working capital, depreciation and tax
- •4. Own research
- •4.1. Review of pharmaceutical market in Russia
- •3.1.1. Russian companies and them place in market
- •3.1.2. Pharmaceutical company “Zdorovie Ludi”
- •3.2. Research strategy (Roadmap of decision)
- •3.3. International and European contracts
- •3.4. National contracting in a global economy
- •3.5. National contract low and human rights
- •3.6. (Step 1) Juristic analyses and common mistakes of the contract
- •3.6.1. The formation and scope of a contract:
- •3.6.2. The content of a contract:
- •3.6.3. Policing a contract:
- •3.6.4. Performance, discharge and breach of the contract:
- •3.7. (Step 2) Controlling of strategy and consideration the contract as investment project
- •3.8. Transformation the contract to the invest project
- •Risk of delivery (for buyer)
- •Techniques of payment (risk for buyer)
- •3.9. (Step3) Forecast of outflow and inflow
- •3.10. (Step 4) Determination the risk and discount rate
- •3.10.1. Country risk analysis
- •3.11. Commercial counterparty risk analysis
- •3.12. (Step 5) Procedure of estimation and comparison of the contract
- •3.13. Book Rate of Return (Advantages and disadvantages)
- •3.14. Payback Period and Discounted-Payback Period (Advantages and disadvantages)
- •3.15. Internal (or discounted-cash-flow) rate of return (irr) and mirr (Advantages and disadvantages)
- •3.15.1. Lending or borrowing position
- •3.15.2. Multiple rates of returns
- •3.15.3. Mutually exclusive projects
- •3.16. The cost of capital for near-term and distant cash flows
- •3.17. Profitability Index (pi, advantages and disadvantages)
- •3.18. Net Present Value (npv, advantages and disadvantages)
- •3.18.1 Calculate npv with glance of inflation
- •3.18.2 Calculating npv in other countries and currencies
- •3.19. (Step 6) Performance and agency problems
- •4. Results
- •4.1. Simulation model analysis and calculation
- •4.2.1. Wacc as discount rate
- •4.2.2. Manager’s working capital use penalty points
- •4.2.3. Risk-Adjusted Discount Rate (radr) and ceq
- •4.3. Summary of Simulation model analysis
- •4.4. Scenario analysis and calculation
- •4.4.1. Discount rates that based on wacc
- •4.4.2. Discount rates that based on radr
- •4.5. Summary of scenario analysis
- •4.6. Final analysis and Decision Card (Step 7)
- •Decision Card
- •4.7. What could be improved and suggestion for future research.
- •Conclusion
- •References
- •Appendix 1 – 7 (Simulation Model and Scenario analysis calculation) (Excel) Appendix 1 (Excel)
- •Appendix 2 (Excel)
- •Appendix 3 (Excel)
- •Appendix 4 (Excel)
- •Appendix 5 (Excel)
- •Appendix 6 (Excel)
- •Appendix 7 (Excel)
- •Appendix 8 (Interview questions and structure of survey) part 1
- •A) Survey for managers
- •B) Survey for specialist
- •Part 2 Survey of experts
- •Part 3 Results and Conclusion a) Survey for managers
- •Conclusion
- •B) Survey for specialist
- •Conclusion
- •C) Survey of experts
Part 2 Survey of experts
a) Estimation of probability the WACC of the company
Respondent’s Name: Position:
Please provide a break down of your years of experience at the following positions:
Please rate the following digits of WACC with respect to their probability to exist it and field the level of probability. Op – optimistic scenario, Mp – most probable, P – pessimistic.
-
LOW
HIGH
1
0.1130 Op.
1
2
3
4
5
6
2
0.1210
1
2
3
4
5
6
3
0.1225
1
2
3
4
5
6
4
0.1310
1
2
3
4
5
6
5
0.1325 Mp
1
2
3
4
5
6
6
0.1330
1
2
3
4
5
6
7
0.1335
1
2
3
4
5
6
8
0.1415
1
2
3
4
5
6
9
0.1425 P
1
2
3
4
5
6
10
0.1450
1
2
3
4
5
6
11
0.1500
1
2
3
4
5
6
12
0.1510
1
2
3
4
5
6
Please write any comments in the space provided below concerning probability of figures. If you feel I have not written some future figures of WACC, please any feedback will be greatly appreciated.
b) Estimation of probability of discount rate which base on MIBOR as risk-free rate in RADR method.
Respondent’s Name: Position:
Please provide a break down of your years of experience at the following positions:
Please rate the following digits of discount rate with respect to their probability to exist it and field the level of probability. Op – optimistic scenario, Mp – most probable, P – pessimistic.
-
LOW
HIGH
1
25.150 Op.
1
2
3
4
5
6
2
25.200
1
2
3
4
5
6
3
25.250
1
2
3
4
5
6
4
25.300
1
2
3
4
5
6
5
25.750 Mp
1
2
3
4
5
6
6
25.800
1
2
3
4
5
6
7
25.900
1
2
3
4
5
6
8
26.300
1
2
3
4
5
6
9
26.450 P
1
2
3
4
5
6
10
26.500
1
2
3
4
5
6
11
26.550
1
2
3
4
5
6
12
26.600
1
2
3
4
5
6
Please write any comments in the space provided below concerning probability of figures. If you feel I have not written some future figures of discount rate, please any feedback will be greatly appreciated.
c) Estimation of probability of discount rate which base on WACC as risk-free rate in RADR method.
Respondent’s Name: Position:
Please provide a break down of your years of experience at the following positions:
Please rate the following digits of discount rate with respect to their probability to exist it and field the level of probability. Op – optimistic scenario, Mp – most probable, P – pessimistic
-
LOW
HIGH
1
23.4500 Op
1
2
3
4
5
6
2
23.5000
1
2
3
4
5
6
3
23.5500
1
2
3
4
5
6
4
23.6000
1
2
3
4
5
6
5
23.8000 Mp
1
2
3
4
5
6
6
24.2000
1
2
3
4
5
6
7
24.4500
1
2
3
4
5
6
8
24.7000
1
2
3
4
5
6
9
24.8500 P
1
2
3
4
5
6
10
24.9500
1
2
3
4
5
6
11
24.9800
1
2
3
4
5
6
12
25.1500
1
2
3
4
5
6
Please write any comments in the space provided below concerning probability of figures. If you feel I have not written some future figures of discount rate, please any feedback will be greatly appreciated.