Financial Management

Syllabus

Course Code: MB25201

Financial Management

Foundations of Financial Management

Introduction, Nature and Scope of Financial Management - Objectives of Financial Management - Major Financial Decisions - Role of Finance Manager - Organization of Finance Functions - Time Value of Money - Valuation of Shares and Bonds - Risk and Return Analysis: Single Asset and Portfolio Context.

Investment and Capital Budgeting Decisions

Capital Budgeting: Concepts and Relevance - Identification of Cash Flows - Evaluation Techniques: Payback, ARR, NPV, IRR, Profitability Index (Problem) - Comparison of DCF and Non-DCF Methods - Cost of Capital: Specific Costs and Weighted Average Cost (Problem) - Application of Investment Appraisal Tools.

Financing Decisions and Capital Structure

Leverages - Operating and Financial Leverage (Problem) - Combined Leverage - EBIT-EPS Analysis - Indifference Point (Problem) - Capital Structure Theories: NI, NOI, MM Approach - Determinants of Capital Structure - Financial Planning and Strategy.

Dividend Policy Decisions

Dividend Policy: Importance and Issues - Relevance and Irrelevance Theories - Walter's Model, Gordon's Model, MM Hypothesis - Types and Forms of Dividends - Factors Influencing Dividend Decisions - Real-World Dividend Practices.

Working Capital Management

Working Capital: Concepts, Determinants and Estimation (Problem) - Operating Cycle - Receivables Management - Inventory and Cash Management - Working Capital Financing: Trade Credit, Commercial Paper, Bank Finance, Company Deposits - Liquidity vs Profitability Trade-offs.

Long-Term Financing and Capital Markets

Indian Capital Market Overview - Primary and Secondary Markets - Long-Term Sources: Equity, Debentures, Term Loans - Lease and Hire Purchase - Venture Capital and Private Equity - SEBI Regulations - Financing Strategies for Startups.