Tag - Investment Opportunities in Egypt

January 2021

The Importance of Business Valuation

The Importance of Business Valuation

The Importance of Business Valuation

 

There are many reasons why Business Valuations are important. It is an essential input to many of the decisions that boards, management, regulators and investors make every day in modern business Such As:

  • Litigation
  • Exit strategy planning
  • Merging
  • Buying a business
  • Selling a business
  • Strategic planning
  • Funding
  • Selling a share in a business

 

Why is called business valuation ?

Determining the true value of a business, a process called “business valuation,” is not just important when the owner is looking to sell the company.

To obtain a business valuation, business owners may wish to contract with a professional appraiser to provide an opinion that will be viewed as independent and objective with the IRS. The resulting business valuation then may be used in a variety of planning applications.

Not all the methods adopted internationally can be fit locally; this fact is rarely considered, especially that the problem of estimating the fair value of assets and companies has become one of the most debatable issues in most of Arab countries.

 

How does the business valuation process work?

Business valuation is a process and a set of procedures used to estimate the economic value of an owner’s interest in a business. An accurate valuation of a closely held business is an essential tool for a business owner to assess both opportunities and opportunity costs as they plan for future growth and eventual transition. It provides either a point-in-time assessment of relative value for an owner, or perhaps the price a buyer would be willing to acquire the business.

 

Read Also :

What is feasibility study and how it affects in project management?

https://truth-uae.com/en/investment-opportunities-in-egypt/

 

Common Business Valuation Methods:

 

Asset Valuation

Company’s assets include tangible and intangible items. Use the book or market value of those assets to determine your business’s worth. Count all the cash, equipment, inventory, real estate, stocks, options, patents, trademarks, and customer relationships as you calculate the asset valuation for your business.

 

DCF Valuation:

In this valuation method we estimate the value of an investment based on its future cash flows. DCF analysis attempts to figure out the value of an investment today, based on projections of how much money it will generate in the future. The Discounted Cash Flows Method requires the following analysis – Revenue, Expense, Investment, Capital structure and Residual value analysis. It values the company considering:

  • Free cash flow to the firm (FCFF).
  • Free cash flow to equity (FCFE).

 

Book Value:

Book value is total assets minus total liabilities and is commonly known as net worth. The book valuation technique is usually used as a method of cross-testing the more common technique of applying multiples to EBITDA, cash flow, or net earnings.

 

Replacement cost

The cost approach is based on the logic of the principle of substitution. The concept is that prudent investors will not pay more for a property than they would for a substitute property of equivalent utility. As with the market approach, there are two potential starting points for a cost approach to valuation: reproduction cost and replacement cost.

Reproduction cost is the estimated cost, at current prices, to create an exact replica of the subject asset, using the same materials, construction techniques and standards, design, and quality of workmanship, and incorporating all the property’s deficiencies, over-adequacies, and obsolescence’s into this exact duplicate.

Replacement cost is the cost to replace an existing property with a new one of equivalent utility, as of a specified date.

Finally.. the concept of estimation and determination of fair value is extremely relative and complicated. Accordingly, it is very difficult to arrive at a conclusion whereby an accusation of detriment is hurled or a reform is praised. In witness whereof, in order to seek a fair judgment and objective thinking, we have first to ask about the basis and assumptions of evaluation if we really want to safeguard our sold assets.

 

The Importance of Business Valuation , Truth Economic & Management Consultancy

 

Resources :

https://masource.org/the-importance-of-business-valuation/

November 2020

What is feasibility study and how it affects in project management?
What is feasibility study and how it affects in project management?

What is feasibility study and how it affects in project management?

What is feasibility study and how it affects in project management?

Feasibility study is a formal project document that shows results of the analysis, research and evaluation of a proposed project and determines if this project is technically feasible, cost-effective and profitable.

A feasibility study determines whether the project is likely to succeed in the first place. It is typically conducted before any steps are taken to move forward with a project, including planning. It is one of the—if not the—most important factors in determining whether the project can move forward.

The growth and recognition of project management have changed significantly over the past few years, and these changes are expected to continue and expand. And with the rise of project management comes the need for a feasibility study.

 

The importance of feasibility study in project management can only be understood within the context of the types of feasibility studies and their main focus. There are three types of feasibility studies. These three types are the Market, Technical and Financial Study. Technical feasibility places particular focus on the availability of technology that is needed to achieve the objectives of the project. The key considerations of technical feasibility are whether the technology is obtained locally, the costs of the technology if it is to be imported and how relevant is it to the achievement of project objectives. In a broad sense technical feasibility seeks to determine the availability, costs and technological risks associated with technology that is needed to achieve project objectives. For example technologically intense projects such as mining require a detailed technical feasibility study that will determine technological availability, costs and associated risks particularly to the environment.

 

How feasibility study affects in project management?

  • Improves project teams’ focus
  • Identifies new opportunities
  • Provides valuable information for a “go/no-go” decision
  • Narrows the business alternatives
  • Identifies a valid reason to undertake the project
  • Enhances the success rate by evaluating multiple parameters
  • Aids decision-making on the project
  • Helps to meet the objectives of the business.
  • Helps to meet the expectations of the stakeholders.
  • Delivers the work at the right time.
  • Resolves problems and issues much earlier.
  • Responds to risks on time.
  • Manages constraints such as scope, quality, schedule, costs, resources)

 

Truth Economic & Management Consultancy

feasibility study

Investment Opportunities in Egypt

Investment Opportunities in Egypt

Investment Opportunities in Egypt

Egypt’s 2030 vision plans to develop a competitive, balanced and diversified economy. Supporting innovation and knowledge, social justice, economic development and the environment. The sustainable development strategy is achieved through a collaboration system investing in human capital and diversified locations in Egypt to improve Egyptians’ quality of life that is built on transparency and social equality , That makes Investment in Egypt is a real opportunity.

Egypt’s fast-growing, young population of 105 million, diverse and expanding economy and its strategic location linking the Middle East, Europe, Africa and Asia all make it an ideal hub for regional and global investment. As an added incentive, a basket of beneficial trade agreements, including GAFTA and COMESA provide the country with favored access to regional growth markets. As Egypt enters a period of political and economic stability, and a reform-minded government carries out an overhaul of the country’s subsidy system, now is the time to invest in Egypt.

 

Why Egypt:

Egypt is one of the highest population densities and ranked 15 internationally and third in Africa. At January 2015, Egypt’s population reached 88 million according. Meanwhile the estimated number of Egyptian abroad is 8 million according to figures released by the Ministry of Foreign Affairs.

Egypt has emerged as a consumer market of significant importance in the MENA region, as witnessed by the arrival of dozens of global brands and the sharp expansion of retail sales in the past years. This is partly due to the sheer size of Egypt’s population that puts it as the most populated country in Africa and the Middle East, as well as the fact that 50% of Egyptians are between the age 15 and 44. Egypt has access to large key markets through various multilateral and bilateral trade agreements with the USA, European Union, Middle Eastern and African countries; which secure benefits to Egyptian-based producers supplying these markets.

Key global markets in Europe, the Middle East, Africa and the Indian Subcontinent are all readily accessible from Egypt. Closer to the European and North American markets than other major exporters including India, China and the Philippines, Egypt is also located on key international logistics routes.

Egypt benefits from the Suez Canal, which is considered to be the shortest link between the east and the west due to its unique geographic location. Approximately 8% of the world’s maritime shipping passes through the Suez Canal each year.

Truth Economic and Management Consultancy provides a selected Investment opportunities in major Sectors in Egypt.

January 2019

Investment Opportunities in Egypt

Investment Opportunities in Egypt

Investment Opportunities in Egypt

Egypt, which is in a strategic position geographically, is the largest natural gas and oil producer in Africa. It is a highly attractive country regarding Foreign Direct Investment (FDI), and its dynamic economic growth rate is high. 7% economic growth was realized before the global financial crisis. It attracts investors with its geographical location, qualified and low-cost labor force, energy resources and tourism potential.

 New Investment in Foreign Investment

Egypt, the first country in Africa’s FDI, is the leader in North Africa. Arab countries, US and EU countries are the countries where the investments are highest. The biggest investor is Great Leadership. Why should we invest in Egypt? What are the strengths of Egypt?

 Egypt’s Strengths for Foreign Investment

  • Rich in energy sources.
  • Geographically strategic location.
  • The growing population is an essential market for foreign investment.
  • Public construction projects are vital investment opportunities for foreign companies.
  • It is advantageous for FDI with state policy practices and liberalization steps.
  • Economic programs implemented after September 2004 attracted foreign investments.
  • Customs tariffs are simplified, attractive for FDI with a 35% discount.
  • Financial sectors are open to FDI and domestic investors.
  • Agriculture, industry, tourism, airlines, mining, maritime transport, oil drilling, road housing, and many other sectors.
  • Special legislation is applied in strategic sectors such as press, defense industry, and aviation.
  • Freedom of establishment of a foreign company is guaranteed.
  • Foreign companies may take over shares of domestic companies. More than 49% of a local bank capital can be acquired from the law no. 97/1996.

 What are the Investment Opportunities in Egypt ?

Investors are increasingly interested in Africa. Egypt is attractive for FDI in many sectors as Africa’s most famous foreign investment country. Investment Opportunities in Egypt are mainly from the construction industry, including the oil industry, tourism, mining, agriculture, industry, air and sea transport, accommodation, venture capital, computer and software development. The number of countries in which the bilateral contract is over 100. It has an agreement with the USA, the Middle East, and Asian countries and many African countries. Apart from military zones and the Sinai region, there is freedom to establish companies throughout Egypt. Investment Opportunities in Egypt continues with the announcement of the international tender tour in May 2016 for the Suez Bay and West Desert Project.

 Best Investment in Egypt

Offering a BRIC-style potential to surpass G20 countries, Egypt is a large market for FDI. Best Investment in Egypt has spread not only to a particular sector but also to many industries. Egypt, one of the most developed countries in Africa, offers highly attractive opportunities to foreign investors in the service and industry sector. The construction sector from the 1980s grew by 15%. Due to the rapid population growth, the need for increased housing needs and infrastructure projects is given. The growth in the construction sector is expected to increase by 70% by 2020.

As the largest oil producer in Africa, the agreements he made with foreign investors in oil and natural gas production exceeded 50 in 2013.

Having opened its doors to foreign investors through investment support offices, tenders and projects, Egypt has an essential place in the history of civilization with its 7000 years history. It is the shining star of Africa from FDI countries. The tourism sector in the coasts of the Red Sea, the construction sector, health, transportation, and the energy sector are the most popular investment areas.

 

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