Marketing Plan of Cadbury Choclate

Introduction

Investment appraisal and Project appraisal is simply known as capital budgeting which focuses on long term investment decisions. Investment decisions involves acquisition of long- lived assets are often referred to as capital expenditure decisions because organizations require that capital expenses or capital funds to be expended to acquire additional resources. Most firms carefully analyze the potential projects in which they may invest to achieve benefits.

There are several principles methods of evaluating capital projects as follows.

- The accounting rate of return

This method calculates the profits that will be earned by a project and expenses this as a percentage of the capital invested in the project. The higher the rate of return, the higher a project is ranked. This method is based on accounting results rather than cash flows.

- The payback period

This method of investment appraisal calculates the length of time a project will take to recoup the initial investment, in other words it means how long a project will take to pay for itself. This method is based on cash flows.

- Discounted cash flows

Discounted cash flow can be divided into two approaches as Net Present Value and Internal Rate of Return.Net Present Value consider all relevant cash flows associated with a project over the whole of its life and adjusts those occurring in future years to their present value by discounting at a rate which is called cost of ca[ital. This method is used with the aim of achieving shareholder wealth. Internal Rate of Return is a method which determines the rate that Net Present Value becomes zero.

Based on several capital budgeting techniques our group decided to analyze how capital budgeting decisions are made by Ceylinco Insurance PLC in Sri Lanka. Ceylinco Insurance PLC commenced its operation on 14th of February 1987. Current Chairman of the organization is Mr. J.G.Perera. Organization consists of seven Executive Directors. Mission of the organization is to provide protection and financial security of the highest quality to society, whilst adding to shareholders’ wealth and recognizing, rewarding and valuing the dignity of our staff. Corporate goals of the organization are mentioned below.

- To provide an attractive return on investment to the shareholders, whilst retaining adequate funds for growth and to achieve a high degree of stability

- To be a leading provider of protection and financial security in Sri Lanka and selected international markets.

- To contribute to the economic development of Sri Lanka and enhance the quality of life of its people.

I managed to find out how Ceylinco Insurance PLC in Sri Lanka makes capital