Length: 1,500 words (+/- 10%)Note: executive summary, contents page, reference list and appendices are excluded from word count. A penalty of 10% will be applied to all submissions over the maximum word count.
Style: Report using Harvard system of referencing.
Weighting: 30% of total course assessment
Submission requirements: Soft copy submission on Turnitin only.
Submission deadline is Thursday 25thJanuary 201823:59 hours (Week 17)
The assignment aims to increase your understanding of the different techniques used in the evaluation of business sustainability and corporate bankruptcy. You are required to apply theoretical knowledge to actual company data.
The purpose of the assignment is to analyse the bankruptcy risk for two companies in the same sector. Some company data(note: all data taken from Bloomberg trading software) is provided for you on the following pages and in a separate excel document, but you should also research any additional information as you feel necessary.
Your report should include the following:
- An evaluation of changes to capital structure for these firms, using data to support your response.Your evaluation should include a discussion as to the risk faced by these companies as a result of the capital structure.(note: weeks 3-5 may help with this, in addition to knowledge gained in ACFI2303)
- An assessment of bankruptcy risk for the two companies, referring to known bankuptcy models to support your assessment.(note: you can use any method/(s) of your choice to determine this but they should be taken from the taught syllabus in weeks 8-10).
- A critical discussion, based on a) andb), as to which company is most at risk from bankruptcy
Both of the companies to be discussed are in the real estate industry within the United Kingdom and are publicly listed with the London Stock Exchange (LSE). Land Securities Group PLC is listed on the FTSE100, meaning it is one of the 100 largest market capital (market value of equity) companies in the UK. Grainger PLC is listed on the FTSE350, being one of the 350 largest market capital companies (but not in the top 100)
Company One –Land Securities Group Plc
Land Securities Group Plc (FTSE100 – Ticker ‘LAND LN’) is a property investment and management company. The group invests in real estate, including offices, shops and shopping centres, out of town retail locations, supermarkets and industrial and warehouse facilities throughout the UK. Land Securities’ portfolio also consists of a small percentage of hotel, leisure and residential properties.
Company Two – Grainger Plc
Grainger Plc (FTSE350 – Ticker ‘GRI LN’) is a residential property company. The company owns and operates residential rental properties in the UK and Germany, develops residential-led mixed use projects and retirement housing, and offers residential fund and asset management services.
Some key financial data for both companies is included in the excel document attached (see Blackboard). You should be able to calculate the key financial ratios required for parts a and b using this information. You may need to generate some values from the data given.
Assessment and Marking Scheme
Please be aware of the academic regulations regarding plagiarism.
See module handbook for undergraduate mark descriptors, which will be used to mark your report in conjunction with the mark scheme given below:
Good marks are available for students applying theoretical capital structure models to the data provided, with a full evaluation of the changes and the risks to the company.
Good marks are available for students applying theoretical bankruptcy models to the data provided, with a full evaluation of the risks to the company.
Good marks are available for students who not only bring the evidence of the previous requirements together but also discuss the credibility of the conclusion derived. Higher marks will be available for a critical discussion of the theory and evidence presented.
Full marks are available for students correctly applying the Harvard referencing system, and displaying appropriate reading around the subject area(please DO NOT ask staff members how many different sources are required for full marks – there is no right answer, and some sources are more appropriate than others).
Structure, style and overall professionalism
Full marks are available for students who produce a professional report, which is well-structured and of an appropriate tone.