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Alex WANG Male Shenzhen China, mainland Finance manager: Share; Share on Twitter; Share on Facebook

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Own capital IRR

Thank you, Dipu and Brent. Currently, we calculate the own capital IRR like this:- 1.calculate the project's yearly free cash flow, incl.cash flow from operations, financing and investment. 2. compar…

Tagged: own capital IRR, IRR

Replied Feb 1

Own capital IRR
3 Replies

Our company is specialized in investment. As per the requirements of the BoD, own capital IRR is one of the financial hurdles to be satisfied for any pententail project. I am wondering what is the ow…

Tagged: own capital IRR, IRR

Started this discussion. Last reply by lijiming Feb 3.

How to calculate the Project IRR for an existing project?

Hi Nitin, So it refers to the investment only when we say "How to finance the project" should be ignored when calculating the Project IRR. Financing to meet the project company's operating cash need…

Replied Jan 29

How to calculate the Project IRR for an existing project?

Dear Lin, Thanks a lot for your kind reply. As you are aware, the financial leverage should not be taken into account when calculating the Project IRR. That means the 20 MM USD loan should be exclud…

Replied Jan 28

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Alex WANG replied to Alex WANG's discussion 'Own capital IRR'

February 1

Brent Wheeler replied to Alex WANG's discussion 'Own capital IRR'

I think the concept your Board is referring to you is the cost of capital faced by your company as measured by IRR. It is unfortunately the wrong hurdle rate for a project since a project must be able to cover the cost of capital of the project - it…

February 1

A discussion started by Alex WANG was featured

Own capital IRR

February 1

Dipu James replied to Alex WANG's discussion 'Own capital IRR'

Own capital IRR is simply the WACC of the company.... ie the cost to the company to pay its debt and the equity. if the project irr is more than this that means you have crossed the hurdle if not even though the project is profitable it will not fi…

January 30

Alex WANG added a discussion

Own capital IRR

January 29

Dipu James replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

i made a mistake 100% of both 10 m and 20 m and 60% of the cash inflows as you own only 60%

January 29

Nitin Goel replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

Hi, Alex what you are saying is correct. Dipu, Not only 60% is to be considered but whole is to be considered for the IRR & 60% is to be considered for the payment part only. Thanks Nitin Goel

January 28

Alex WANG replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

January 28

Dipu James replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

both has to be considered for calculating B's IRR. but if you are calculating company a's IRR shouldnt we onlyconsider 60% of the both(10m &20M) and 60% b's other cash flows has to be considered.

January 28

Nitin Goel replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

Hi Alex, As rightly said by lin, 20 mm USD loan is not be ignored & it is to be projected in the forecasted balance sheet for the 2011-12. Thanks Nitin

January 28

Alex WANG replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

January 28

Lin Giralt replied to Alex WANG's discussion 'How to calculate the Project IRR for an existing project?'

I don't think so... IRR involves calculations of cash flows, both incoming and outgoing... both the 10 and 20 MM USD loans have interest and capital payments that affect the cash flows, therefore both loans, plus the cash flows to and from the proje…

January 25

Alex WANG added a discussion

How to calculate the Project IRR for an existing project?

Our company is going to acquire 60% shares of Company B in Jan. 2010. As of the end of 2009, there is a loan amounting $10 million on Company B's B/S, and it is projected that it will finance $20 million in 2011. When calculating the project IRR, my…

January 15

Profile Information

Profession:

Accountant

Current Role:

Finance manager

Past Experience:

Tax manager

Education:

postgraduate

Current Location:

Shenzhen

Interested In:

expertise requests

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