It is mainly due to the significant investment in research and development of technology transformation of their car. It is also the result of the company within a few years of rapid expansion. Tesla also Gigafactory invested heavily in the construction of the Gigafactory has begun production of batteries, and lithium batteries manufactured before the end of the year. Because these large cash outlay, Tesla will report earnings and free cash flow. Therefore, Tesla was forced to add more debt and sell more shares.
Tesla Coupled with Giga-Factory, it’s mass market car Model 3 intends to do just that to provide a mass-market car and maintain cost leadership through economies of scale. Introduction of Lithium-ion Cells Giga-Factory Tesla is gradually shifting its strategy from being a niche player to mass player following blue ocean strategy. After creating a unique product in Tesla cars, it is focusing on reducing the costs of manufacturing thereby reducing the prices of its products and makes the cars more mass market. Another reason is that to recover its large fixed costs investment in supercharger stations, it needs to boost sales but sales have not been able to meet the demand because of slow production of Li-ion cells. Tesla plans to launch a Giga-Factory by the end of 2017 to minimize the crunch of supply -demand gap of Li-ion cells.
Such strong revenue visibility should allow the firm to adjust production rates and ride out economic downturns (Boeing website 2012). The current ratio takes Boeing’s current assets and divides it by their current liabilities. Boeing has seen an increase in their current ratio over the last three years. In 2009, Boeing’s current ratio was 1.07. Essentially
Market risk premium: Average of estimates made by NYU and Bloomberg up to Apr. 2016-8.19% C. Beta: regression on stock return against market return (Heng Seng Index, Apr. 20106-Apr.2016)-adjusted beta=1.029(raw beta=1.043) 6. Growth rate: previous year reinvestment rate and ROE contribute to current year growth rate RELATIVE VALUATION Key Assumptions: 1. Comparable company: Selection is based on business nature, geography and financial conditions.
According to Readyratios.com, the Debt to Equity ratio should be normally 1,5-2,0 or smaller. The data in the excel table extracted from the Barry Callebaut Annual report concludes that a company is doing well in terms of its liabilities and equity proportion. Despite a gradual increase in the ratio from 64,9% in 2011 up to 100,7% in 2014, the company’s ratio is currently declining, and is at 74,3% in 2016 which shows that the company is financed more from its own financial sources rather than by those of creditors’. The Payout ratio gives information about the percentage of net income that is used to pay the dividends. Since Barry Callebaut is a large company, its payout ratio is quite high: more than 30%.
Accounting profits are sales revenues minus explicit cost of a business whereas economic profit consists of sales revenue minus explicit and implicit costs. The difference is on the fact that economic profit substances implicit cost too, while accounting profit may include depreciation. For example, if I run a business and sells goods worth $10,000, the cost of sales being $4,500. If the premises used for the business could be put to alternative use for rent earning $1,000. And the capital if invested in the bank will earn me $1,500 interest.
(Chandler, 2013) Customers have greater access to products so they can choose between, for example, a cheap more polluting car and a more expensive non-polluting car. Also, there is more competition so Tesla needs to distinguish itself from other companies by focusing on CSR. An emerging force that may reshape CSR in the future might be climate change. In order to diminish climate change as much as possible, corporate social responisibility is very important. Companies should think about less polluting products and production processes for
Governments all over the world are trying to promote electric cars. Increased advertising, electricity stations at gas stations and tax refunds on electric cars are all meant to increase the amount of electric cars sold. It may very well be that the electric car is the future, that the production and manufacturing will be made more efficient, more environmentally friendly. However, the fact remains that currently, they should not be. Since a large part of the pollution produced by electric cars also comes from the manufacturing of the actual car, its well worth looking at the individual parts of a gasoline and an electric vehicle.
in order to gain more benfit, They need to change its marketing strategies and do more promotion in regions which contain large population for example China. Situation Analysis: Tesla takes leadership of electric vehicles industry in Hong Kong. Till December 2015, Hong Kong has over 4000 electric vehicles, at the same years, Tesla sells over 2000 of its product Model S which makes Tesla obtains 80 percents of electric vehicles sales (Engadget, 2016). Although Tesla’s products are good enough to obatin its popularity, the company also gets benefits from differents aspects which leads to its rapidly development, we will use the Pest analysis to explain what advantage Tesla gains and what disadvantages it suffer. As a new-energy transportation without pollution, Tesla would be more beneficial than traditional vehicles that use gas as fuel to some extent.
II. Analysis of PFC’s Operational Parameters Impacting lending Rate For fixation of lending Rates, factors impacting the asset side and liabilities side are analyzed. In this respect the two important factors are: 1) Assets falling for reset PFC provides an option to its borrowers for availing loan at floating interest rates i.e. rates are subject to reset after 3 years or after 10 years. Thus, the assets are re-priced every 3 years and 10 years depending on the option taken by the borrowers.