AN ANALYSIS OF BANK LOAN VS LEASING: CASE STUDY ON PT SARANA LOGISTICS
The competition in logistic industry is intense especially in the Industrial area where the needs for logistic is relatively high. To stay competitive, one of the measures that companies must take is to purchase additional asset to support its operation and accommodate increase in potential revenue....
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| Format: | Theses |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/68244 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | The competition in logistic industry is intense especially in the Industrial area where the needs for logistic is relatively high. To stay competitive, one of the measures that companies must take is to purchase additional asset to support its operation and accommodate increase in potential revenue. Consequently, Significant amount of financing is required to for firms to undertake these activities, which can be from internal and external financing. If firm have sufficient funds from its current earning, then it would not need external however this is not the general case. In addition to its internal funds, most of firms would need to obtain external funding as the amount of financing undertaken is significant. Relying solely on internal financing would disrupt the stability of firms’ cash flow. Leasing and bank loan are the two alternatives available for external financing.
This research aims on analysing bank loan vs leases option for PT Sarana Logistics, a logistic company domiciled in Cilegon Area which provides trucking service in the area. As the demand for logistic grew in the area, the company hope to seize the opportunities through obtaining additional trucks. The decision becomes inevitable as more competitor coming into the market as a result of growing market. The evaluation of lease and bank loanis analysed by comparing net present value (NPV) of cash outflows and internal rate of return for each option. The discount rate used in the method is weighted average cost of capital (WACC).
The result from this research shows that NPV of cash outflow of bank loan option discounting using WACC resulted in Rp5.989.338.130. This is lower than NPV of cash outflows derived from leasing of Rp6.027.300.722. Although leasing have several non-financial benefit, PT Sarana Logistics puts high consideration on financial metrics therefore it is recommended that bank loan becomes preferred option for the financing,
The implementation begun by engaging directly with the bank and unit dealer to provide required documents such as collaterals and financial statements. In addition, PT Sarana Logistics need to create revenue projections which will ensure that firm have sufficient liquidity in the future. Future projections must be periodically reviewed by directors to ensure healthy financial performance which increase budget for upcoming year expenditure. |
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