Instructions

This is a group research project that must be completed and submitted as a group. Each group is expected to collaborate effectively and equitably. All members must contribute to the project.

Mark Allocation:

This project will be marked out of 30 and constitute 30% of your overall grade.

Length:

The length of the submitted assignment report should be no more than 3,000 words including executive summary and in-text references but excluding the reference list and appendix (if any). Please use normal-sized margins, double spacing and 12 points Times New Roman in your assignment report.

What’s included in the 3000 words limit?

•    Executive summary

•    Assignment body

•    Tables

•    Figures

What’s excluded from the 3000 words limit?

•    Title (Cover) page

•    Table of contents

•    Appendices

•    Reference list

Due date:

The due date and time for the project is 2025-10-17 23:59 (Sydney time).

Submission:

The only acceptable form of submission is electronic via the submission link in the unit’s Canvas site. Hardcopy and email submissions will NOT be accepted. Late submissions will be penalized. See below for penalty details. All submission will be checked through TURNITIN for similarity with external sources.

Late submissions are accepted with penalty until the final closing date of October 31, 2025, 5:00pm. After this, no further submissions will be accepted.

Submission format:

Each  group  can  only  submit  ONE  project  report.  Only  ONE  submission  for  each  group  is permitted. It is imperative that your project report is submitted in ONE document. Only a PDF format document will be accepted and it is your responsibility to ensure all pages correctly display your original content. Missing or distorted figures and formulas etc. will result in lower marks.

In addition, please also submit your Excel modeling file as a .xlsx workbook to allow for cross- checking of your calculations. However, marks will be based solely on the content of the submitted PDF report.

Cover page:

Ensure the Student Identification Number (SID) and the full name of EACH student are on the cover page of your assignment.

Document name:

Your project PDF file must be named in the following format: FINC6001_Groupnumber_ 2025S2.PDF

Example:

FINC6001_Group14_2025S2.PDF

There will be a penalty of 1 mark for incorrectly named projects.

Referencing:

List of references used and in-text citations must follow the Harvard referencing style

http://libguides.library.usyd.edu.au/content.php?pid=160012&sid=1510179

Presentation:

Pay particular  attention  to presentation. A significant  component  of your mark will be based  on presentation. Avoid overdoing formatting, and ensure that the assignment is very clear, logical, and professional. Pay attention to grammar. Clear and logical presentation is a major challenge. Preparing a concise report is another major challenge. Every part of the assignment should add to the end result otherwise it is superfluous and distracting.

PENALTIES:

Late penalty:

A late submission will attract a deduction of 5% of the maximum mark for each calendar day after the due date. After ten calendar days late, a mark of zero will be awarded.

Incorrect format penalties:

1 mark penalty will apply for every 100 words over the 3,000-word limit.

1 mark penalty will apply for inappropriate referencing and formatting.

1 mark penalty will apply for failing to follow the naming convention of the project.

Plagiarism:

Plagiarism is abreach of the University of Sydney Code of Conduct and will be dealt with by the Faculty.

http://sydney.edu.au/student_affairs/plagiarism/index.shtml

Be sure to acknowledge all of your source materials and provide proper citations for any quotes. Students are permitted to use Cogniti, the University’s approved generative AI tool. However, the use of AI in the group assignment should be properly acknowledged in the executive summary of the project report. The checks for similar contents (web materials, other students’projects, etc.) and plagiarism will be conducted by TURNITIN; the projects with a similarity index significantly above an acceptable level will be reported to the faculty and this may result in a zero mark being awarded for the project.

Library (https://mba.tuck.dartmouth.edu/pages/faculty/ken.french/data_library.html).

You are encouraged to estimate and compare across more than one model to assess robustness.

1.3 Estimating the Weighted Average Cost of Capital (WACC) (4 marks)

Calculate the WACC for P&G.

•    Estimate the market values of equity and debt. Market value of interest-bearing debt can be approximated by the book value.

•    Determine the  appropriate cost of debt (using either yield to maturity or interest coverage approach).

•    Use your previously estimated cost of equity.

•    Justify the tax rate and capital structure assumptions.

•    Discuss the implications of WACC in your valuation process.

1.4 Estimating the Firm’s Stock Price Per Share (6 marks)

Estimate the intrinsic value of P&G’s equity using both:

•    Discounted Free Cash Flow (DCF) approach and

•    Dividend Discount Model (DDM)

Ensure that:

•    Terminal value is estimated appropriately (e.g., perpetuity growth or exit multiple).

•    Discounting is done using WACC (for DCF) and cost of equity (for DDM).

•    Model outputs clearly report the estimated fair stock price per share.

Compare your estimate with P&G’s current stock price (as of the most recent trading day) and provide a clear interpretation: Is the firm undervalued, fairly valued, or overvalued?

1.5 Strategic Restructuring Plan and Value Creation (6 marks)

Assume you are tasked with advising P&G on potential value-enhancing restructuring strategies. Based on your analysis, identify at least one major restructuring option, such as:

•    Capital  structure  optimization  (e.g.,  increasing  financial  leverage,  reducing  excess  cash holdings, or initiating a share repurchase program)

•    Asset sales or divestitures of non-core or underperforming business units to sharpen strategic focus and free up capital

•    Spin-offs of business segments with distinct risk-return profiles to unlock hidden value and improve transparency

•    Business portfolio realignment, such as shifting investment toward high-margin or high-growth product categories

•    Operational efficiency initiatives, including cost reduction programs, supply chain optimization, or productivity enhancements

•    Strengthening  corporate governance,  such as enhancing board independence or redesigning executive compensation to better align with long-term performance

•    Enhancing ESG practices to improve reputation, reduce regulatory and reputational risk, and attract long-term investors

Then:

•    Estimate the potential value gain (e.g., increase in share value) resulting from the restructuring.

•    Ensure to provide supporting analysis in Excel.

•    Discuss practical considerations, such as feasibility, implementation timeline, potential risks, and stakeholder impact.

2 Presentation and References (2 marks)

The remaining 2 marks will be awarded for the clarity, structure, and professionalism of your report:

•    Include  academic  references  to  support  your  methodologies  and  discussions  (e.g.,  from academic journals or textbooks, not just web pages).

•    Ensure that your analysis is concise yet comprehensive and logically structured.

•    Avoid excessive formatting. Keep the report clear and professional.

•    Excel  models  should  be  well-organized,  with  clear  labels,  consistent  units,  and  linked calculations.