#TITLE_ALTERNATIVE#

• Main Author: ACHYADI (NIM 29106354), ANDRI
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/7209
• Institution: Institut Teknologi Bandung

Increasing Crude Palm Oil (CPO) consumption in the world causes its price to climb by 92% in the past one year to its record price on December 2007. It have been contributed positively for the oil palm plantation business in Indonesia and increases the government's income. PT XYZ, an oil palm plantation company in South Sumatera, Indonesia, has been planning to build a palm oil mill with production capacity of 10 tonnes FFB per hour. This mill will developed through a partnership program with oil palm farmers in region of OKU, South Sumatera. With this program, the farmers are obliged to sell their product to the mill and as the trade off, the farmer will be given a right to invest their capital to the company. It is expected that PT BSU will be able to gain advantages of the increasing CPO price and be able to absorb all of the farmer harvest as part of the partnership program. This will create value to the company, farmers and local people of the region.<p> <br /> <br /> <br /> <br /> <br /> Limitation of fund experienced by PT BSU is considered as the main obstacle for the company to set up the plant. The company needs to find external source of fund. Correct feasibility study method and its positive results are the requirement that have to be fulfilled so that the required fund can be borrowed from bank. Valuation of the company's stock is needed as well to determine the amount of money to be paid for by the partnership members.<p> <br /> <br /> <br /> <br /> <br /> The result of analysis using discounted cash flow method shows that the project has an NPV of Rp 46,597,678,000, IRR 37%, ROI 44.21% and ROE 28.28%. The results conclude that the project is feasible. Valuation of company stock using FCFE method shows that the fair value of the stock of this project is Rp 26,988 per share, Valuation of company stock using relative valuation method shows that the fair value of the stock of thsi project is Rp 35,614 per share.<p> <br /> <br /> <br /> <br /> <br /> Based on sensitivity analysis, it is concluded that this project is very sensitive toward decrement of palm oil production yield. A 10% decline of the palm oil production yield causes NPV to decrease to (-)Rp 1,647,381, IRR to 13%, ROI to 13%, dan ROE to 4%. Therefore, it is advised that the company must keep its yield to the presettled standard.