Anwal Gas Traders: Capital Budgeting for Expansion Project
In February 2021, the owner of Anwal Gas Traders, a liquefied petroleum gas distribution company based in Sakesar, Khushab District, in the province of Punjab, Pakistan, was considering whether to invest in expansion. It would be the first significant expansion for the company since its founding in 1998. Based on data provided by a consultancy firm performing capital budgeting techniques, the company would integrate backward to take advantage of perceived market potential. The owner needed to determine whether this investment was worth making and how various scenarios would affect his decision. Zhichuan (Frank) Li is affiliated with Ivey Business School. Aaqib Nawaz is affiliated with Heriot-Watt University.