Investment Appraisal and NPV/IRR Calculator (Excel)
An Excel model for investors and finance teams to judge whether an investment is financially viable. From your assumptions, it builds a 10-year cash flow model: revenue, operating costs, EBITDA, depreciation and tax capital spending, working capital and salvage value a loan repayment schedule and DSCR free cash flow for the project as a whole and for the equity investors It calculates: NPV, IRR and modified IRR (MIRR) profitability index simple and discounted payback equity NPV and IRR a clear invest or don’t-invest decision A Sensitivity sheet tests price, volume, costs, capital spending and the discount rate at ±10% and ±20%, with a spider chart. A Compare Options sheet ranks up to five alternatives, and a one-page Summary is ready for investment committees. How to use: Inputs: enter the discount rate (WACC), tax rate, capital spending, working capital, volumes, prices, costs, loan terms and capacity ramp-up. Record the source of each key assumption. Cash Flow Model: check the annual projections. They calculate automatically, so no data entry is needed here. Results: invest if NPV is above 0 and IRR is above WACC. Check that DSCR meets your lender’s requirement. Sensitivity: find the drivers that move NPV most, and test assumptions that look risky. Compare Options: enter the cash flows of alternative investments and choose the one with the highest NPV. Summary: use the dashboard in reports and presentations. Before use: replace the example figures with your own data. Change only the blue cells.