Financial feasibility study of water supply system (SPAM) business at X port in Sumatera Island, Indonesia

Abstract

Abstract The purpose of this study is to examine the analysis of financial feasibility study for new business investment in a water supply system (SPAM) at X Port in Sumatera Island, Indonesia. This project investment is essential for every ships and boats visiting X Port. This financial feasibility study is carried out to determine whether SPAM business project is feasible or not. The measurement items for this analysis are Net Present Value (NPV) method, Internal Rate of Return (IRR) method, Payback Period (PP) method, Profitability Index (PI) method, and Benefit-Cost Ratio (BCR) method. This business project has a concession period of 20 years during 2024 - 2043 and a construction period of 1 year in 2023.The analysis is using the benchmark on the same business project at different port in Sumatera Island, Indonesia. The results of this study show that all of measurement items are feasible indicating that SPAM business project using this calculation is feasible to be conducted.