| The Board of Studies has decided to launch case study based pedagogy for the benefit of students at Professional Education (Course-II) and Final Levels. These cases are being included in the Students' Newsletter and on the Website. Students are requested to send there analyses by the specified dates. Earlier cases are also included with hints to assist the students. |
Hints: The dilemma before the Chairman of SBL is whether to make further investment of US$13.75 million (25% of the subordinated loan amount of US$55 million) or to just contribute additional US$ 5 million (the remaining equity contribution). However, if the Chairman does not contribute the loan amount, the entire Joint Venture (JV) may be in jeopardy. If he contributes the additional US$13.75 million, there is also no guarantee that the venture would earn sufficient profit to justify investment. The other JV partner (MOL) is, however, not that pessimistic about the future prospect of the JV and is willing to pay 75% of the loan amount of US$55 million. As an extreme step, the Chairman of SBL can also explore the possibility of selling its entire equity stake to MOL. But as the fact of the case suggests that scenario is unlikely to happen. Hence, the task of the Director Finance of SBL is to estimate the IRR of SBL's investment under two scenarios: Scenario I: SBL makes the additional investment of US$18.75 million; Scenario II: SBL just invests its equity contribution of US$ 5 million.
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Case Study - The Dilemma of Sailing Beauty Limited
Solution
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Case Study - Income Tax
Solution
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Case Study - Exploring Value in Sunshine Agro Food
By Dr. T.P Ghosh, Director of Studies
Data Files
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Select Cases in Direct and Indirect Taxes (2006)
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