ABSTRACT
In August 2019, Radha Swaminathan, Chief Financial Officer (CFO) at Huarache India Ltd (HIL), evaluated a significant expansion proposal involving an annual Capex of Rs 200 crore for the next three years. HIL had just raised Rs 175 crore by selling a 24% stake to a private equity (PE) firm. In the deal term sheet, the PE firm insisted that HIL evaluate its investment proposals using Net Present Value (NPV) criteria and accept only those CapEx proposals that could deliver positive NPV.
