Financial Re-engineering
In a quest to grow, management gets more focused to increase Sales, giving relatively lesser importance to other critical aspects as efficiencies, wastages, costs and cash-flow's. We do a thorough review on the business from SHAREHOLDERS EYE and advise critical levers, which if fine-tuned, can improve the profitability and the cash flows.
01
Selection of the right product
Selection of right financial product for the financial needs is very critical to remain competitive in the business. With our vast experience of dealing with banks and financial institutions, we advise companies to the best product for their business needs.
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CMA : Collateral Management Arrangements: This is a product to finance high volumes of commodity. Corporates can freely concentrate on increasing business volumes without caring much of the financing needs. This is also one of the best working capital management tool where funds are locked in tight discipline and diversion to other business activities is not possible.
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Overdrafts : An effective tool to manage day to day financial needs.
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Term Lending : For new greenfield projects and business expansions, the repayments are structured in line with repayment capacities and cashflow generations.
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Non Funded Limits : Letter of Credits and Bank Guarantees ; Can be used as an effective tool to manage the cashflow and to reduce interest burden.
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Private Equity : An effective route to fund the company: PE funds tend to bring professionals on Board and Management, which adds up to fuel growth and brings better governance.
02
Cross currency SWAPS
African economies have a major problem of high financial costs for the loans, the same can be reduced by swaping the local curreny exposures to foreign currency which have substantially lower interest rates, the swaping is advised after reviewing the volatility of local curencies.
03
Hedging of FOREX
Countries in Africa are prone to great volatility in foreign exchange rates, companies should have a well defined Forex hedging policy to reduce the impact of volatility on its business. The Business should not be dependent on the Forex as this is a very specialised areas and is difficult to predict the trend the direction of currency.
04
Leveraging Interest rate differentials
Every banks has different financial needs and positions, at many a times the position varies hugely between two different banks; companies can take advantages of these situations by generating a risk free income without andy investment.
05
LC's as cash-flow management tool
Because of very high interest rates in Africa, LC's works out to be a very effective tool to reduce the financial costs. Moreover this is also a very effective cash flow management tool.