FINANCIAL PERFORMANCE ASSESSMENT AND VALUE IMPROVEMENT OF PT. RAJAWALI NUSINDO
PT Rajawali Nusindo is one of the oldest Indonesian trade and distribution companies that run in pharmaceutical and health devices that have a vision to keep increasing the stakeholders’ value through the initial public offering (IPO). However, with Rajawali Nusindo’s current financial performance t...
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| Format: | Final Project |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/21187 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | PT Rajawali Nusindo is one of the oldest Indonesian trade and distribution companies that run in pharmaceutical and health devices that have a vision to keep increasing the stakeholders’ value through the initial public offering (IPO). However, with Rajawali Nusindo’s current financial performance that indicates the low profitability, the IPO process might be concerning due to the higher risk that has to be burdened despite the higher return as well. This study focusing on finding the financial improvement strategies in ensuring the well functioning IPO by overcome the profitability matters to increase the values of the company.
The company’s annual report for the past five years will be used as the data to analyze the overall financial performance using DuPont method. The result will be applied as a foundation to create an improvement financial performance strategy that later will be valuated using the discounted cash-flow (DCF) valuation model. The assumptions for the DCF valuation are made from the company’s long-term strategic planning, company’s trend from the historical data and combined with the current market situation.
The result reveals that net profit margin and total asset turnover are the main causes of the low profitability. Using discounted cash flow (DCF) valuation model, it is proven that PT Rajawali Nusindo can get 1.56 times increases in the firms value amounting IDR521,544,380,459 additional value from IDR926,771,538,573 before any improvements to IDR1,448,315,919,032 after the cost minimization in employee expenses from 7% growth to 3.5% and acceleration in average collection period from 66 days to 40 days. To apply this proposed improvement strategy, the company should more utilize the fund allocated for training and evaluate the current collection payment policy. |
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