Sunar Factory: investment opportunity and a financing dilemma

Case overview / Abstract

In May 2018, Jawwad Karim, owner of Sunar Factory, was con sidering purchasing an X-ray Fluorescence (XRF) Gold Testing Machine for his small jewelry store in Saddar, Karachi. Karim would be the first jeweler in the city to use an XRF machine to certify the gold content of the jewelry for his customers and expected to attract a large volume of jewelry buyback transac tions by promoting the same. With the price charged for the testing service and the buy-sell gold price difference earned, Karim believed that the investment presented an opportunity for him to reap high cash flows in the near future. While the idea to purchase the XRF machine seemed attractive, Karim had yet to perform the feasibility analysis to go ahead with the investment. Furthermore, arranging funds for the investment seemed more difficult. Since Karim's ongoing jewelry-making business earned enough income to cover his personal expenses, a major portion of financing would have tc come from an external source. Karim had been exploring the possible sources of financing and had to select the alternative that offered the best combination of benefits and costs.

Case Areas

Feasibility Analysis, Business Investment, Financing Expansion, Financing Options

Disciplines

Business | Fashion Business | Finance and Financial Management | Technology and Innovation

Teaching Notes

No

Faculty / School

Faculty of Business Administration (FBA)

Department

Department of Finance

Was this content written or created while at IBA?

Yes

Source

Asian Case Research Journal

Length

8 pages

Link to Full Text

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