Corporate Finance

Corporate finance is one of the two primary branches of finance, the other being market finance. It focuses on the financial decisions and operations of companies, playing a vital role in effective corporate management and enabling businesses to increase both profitability and value.

Our Objectives

A company’s primary objective is to generate profit. To achieve this, it must implement a financial policy and a financial strategy designed to ensure increasing profitability, solvency, and sufficient liquidity reserves. Finance the company must then analyze and increase its market value. This involves improving future monetary profits. Indeed, companies must have the necessary financial resources for their operations and activities, as well as for their development and economic and financial profitability. It evaluates the relevance of decisions regarding investment policies and projects, optimizes corporate balance sheet structures, remunerates the providers of capital necessary for the company’s operations, and improves financing conditions.

Managed by the company’s CFO

Corporate finance is established and managed by the company’s CFO. In this role, they oversee financial operations in coordination with banking partners and shareholders. Their objective is to ensure the company’s solvency, thereby maximizing profitability for both the organization and its shareholders. Consequently, the growth of the company’s value depends on this management. The CFO evaluates performance based on general accounting principles, while also accounting for risk factors, particularly regarding reliance on external capital. Furthermore, they manage loans, debt, equity, investment decisions based on profitability, dividends, and potential initial public offerings.

The basis of its approach

In corporate finance practice, it is essential to evaluate and analyze financial investment projects to determine their profitability for the company and to compare them in order to select the most advantageous option. The evaluation of these investment projects takes into account Net Present Value (NPV), Internal Rate of Return (IRR), the payback period, and the profitability index. Net Present Value, which represents the difference between the present value of expected cash flows and the initial capital outlay, determines whether a project is profitable relative to its cost. If the value is positive, the project is considered profitable.