Hi,
I had case study today where you acquire solar farm with 80% debt and 20% equity. For the Cash flow for equity investor in the first period there is huge cash flow - debt drawdown (80%) and then debt repayments and interest as cash outflows. It made XIRR function not working due to first cash flow being so much positive (then negative due to CAPEX investments). Is it correct approach?
Thanks!
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If you are calculating an equity IRR, why are you including the positive debt inflow? Your XIRR should only include cash flows / calls payable to the equity investor.
Two comments,
Please shoot me a PM- would like to learn more about about this case
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