Valuation to determine enterprise value for a metals and mining major; Standard Chartered Bank, Mumbai

Abstract

The primary objectives of the project was to analyse the Metals & Mining sector, the commodities market primarily base industrial metals. The first part of the project involved understanding the dynamics of the sector in order to be able to enunciate the underlying factors which influence the revenue drivers of the industry. The identification of the revenue drivers and the evaluation of the relationships between underlying economic variables and the revenue drivers would enable the estimation of the future financials of the firms. Once the revenue drivers for the various firms are identified and their dependencies established, the financials for the firms are projected for the next three financial years. The validity of the estimated financials is tested by extending the projections for the current financial year to a future horizon.