ABSTRACT:- PT XYZ, a major provider of clean water in Cilegon, faces increased demand due to population growth and industrial expansion, particularly in the petrochemical sector. To ensure a sustainable and reliable water supply, the Phase III Capacity Enhancement Project is proposed. This project aims to upgrade infrastructure, increase capacity, and improve the distribution network and Water Treatment Plant (WTP), along with enhancing mechanical, electrical, instrumentation, and automation (MEIA) facilities.A capital budgeting analysis was conducted to evaluate the financial feasibility of this project, considering Net Present Value (NPV), Modified Internal Rate of Return (MIRR), and Discounted Payback Period (DPP), using the Weighted Average Cost of Capital (WACC) as the discount rate.The analysis indicates the project is financially viable, showing positive financial returns and a payback period within the project’s economic lifespan. These findings support the project’s capacity to meet Cilegon’s water demand sustainably.

KEYWORDS –Capital Budgeting, NPV, MIRR, DPP, WACC