Moolani Fondation

Topics: Purchasing power parity, Economics, Africa Pages: 2 (395 words) Published: July 16, 2013
Moolani Foundation Case Analysis
According to the case I made some analysis of the environmental conditions in South Africa, India, and Kenya (Please also refer Excel file Hult/Financial Management/Moolani Foundation/Moolani Foundation_Tungalag PUXI.xlsx).

1. South Africa
To compare with other 2 countries, South Africa’s advantage is they have higher GDP per capita and overall economic condition is good. Also the exchange rate fluctuation is quite stable for last 3 years. However unemployment rate is 3 times higher than India and another disadvantage is number of microfinance institutions is fewer than others. 2. India

The economic and political conditions quite stable than African countries and GDP real growth rate was higher than others. One big advantage is there are over 100,000 microfinance institutions. 3. Kenya

There are many disadvantages for example the exchange rate fluctuations are very high, GDP real growth was 2.2% and the cost of living is higher than others. That means Kenya’s business environment is unsustainable.

Therefore I would advise to start project in India and it will be provided the best long-term opportunities for the Moolani Foundation. Also India has fulfilled the Moolani’s criteria such as number of microfinance institutions, business conditions, and low living costs etc.

Cash budget for Year 1 (including admin costs)
Country| Cash Budget ($)| Remark|
South Africa| 13,380| Exchange rate allowance was not included| India| 12,530| |
Kenya| 12,730| |

If we see the Exchange rates graph for last 4 years the fluctuations was not much high except Kenya and based on this tendency I’ve calculated the allowance for the exchange rates when it increasing 5% in the cash budget.

Cash budget for Year 2 (including 4 students and admin cost remained constant) Country| Cash Budget ($) | Remark|
South Africa| 23,430| Exchange rate allowance was not included| India| 21,730| |
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