Learning Project Finance Modeling by Building and Comparing Spreadsheets
Summary
The document addresses how to learn to build project finance spreadsheets, including modeling debt and equity, hurdle rates, internal rates of return, and alternative financing structures. The replies recommend constructing models from scratch so the learner follows how calculations work and can adapt them to a project. They also suggest studying Excel and VBA techniques to make spreadsheet work more efficient.
As another learning route, the discussion points to existing valuation spreadsheets as exercises: recreate a model independently, then compare its outputs with the published version. It also mentions introductory templates and books as potential resources. These are practical suggestions rather than a staged curriculum or a worked project finance case. The document provides no specific model, exercise set, or evidence comparing the suggested resources, so learners would need to choose a suitable project and verify that examples cover project finance cash flows and financing structures.
Key ideas
- Building a spreadsheet from scratch can help learners understand each calculation and adapt the model.
- Project finance models commonly examine debt and equity structure, hurdle rates, returns, and financing layers.
- Existing valuation spreadsheets can be used as practice by rebuilding them and comparing outputs.
- Excel and VBA references may help streamline spreadsheet work.
- The replies suggest resources but do not provide a structured project finance exercise sequence.
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Full text
# Where can I find exercises on building a project finance spreadsheet? # Where can I find exercises on building a project finance spreadsheet? I'm looking for a set of exercises that teach how to build a project finance spreadsheet. I accept there may be no typical project finance, but there are a lot of principles are shared in common across a lot of projects. The debt/ equity split, setting hurdle rates, calculating IRR, looking at how yields vary depending on various outcomes, tiered senior debt / subordinate debt / different types of bonds (deep-discount, income, convertible, etc) / equity. I'm working my way through various books on the subject: Yescombe's "Principles of project finance", Tan's "Principles of Project and Infrastructure Finance", Merna & Njiru's "Financing Infrastructure Projects", and so on. Now I'm looking for some electronic resources: specifically, a way to start building example project-finance spreadsheets, to analyse the structure of project-finance deals, to teach myself, in stages, how to build such a thing. Please can you point me at some suitable resources? ## Answer by Justin (score 3) https://quant.stackexchange.com/a/4424 In my estimation, you are best-served by creating these sheets from scratch. There are a number of reasons for this: - You will thoroughly understand the underlying machinations of each calculation - You can customize to your specific needs, and so on... If you are looking for some decent introductory texts, I have benefited from Moyer Excel Templates. More generally, I would consult Excel/VBA texts as they will show you some useful tools on how to streamline some of your spreadsheets, assuming you want them to be in .xls format. ## Answer by PBD10017 (score 1) https://quant.stackexchange.com/a/4417 I'm not aware of any exercises. You do not mention whether you tried Google. A good set of spreadsheets is on the Home Page for Aswath Damodaran. You could convert it into "exercises" by first working through them yourself and then comparing to Damodaran's solution (or whether it gives the same results).
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