Financial Management

Nature and Scope of Financial Management:

Nature, Scope and Objectives of Financial Management; Risk-Return and

Value of the Firm; Objectives of the firm; Profit Maximization vs. Wealth

Maximization; Emerging roles of Finance Managers.

Capital Budgeting: Compounding and Discounting techniques- Concepts of

Annuity and Perpetuity; Capital Budgeting

Process; Techniques of Capital Budgeting- Discounted and Non- Discounted Cash

Flow Methods; Capital Rationing; Risk

Evaluation and Sensitivity Analysis.

Capital Structure:

Introduction- Meaning and Significance; Optimal Capital Structure; Determinants of

Capital Structure;

Theories of Capital Structure; EBIT - EPS Analysis; EBITDA

Analysis; Risk and Leverage; Effects of Leverage on Shareholders’

Returns.

Sources of raising long-term finance and Cost of Capital:

Sources, Meaning, Factors Affecting Cost of Capital; Methods for

Calculating cost of capital; Weighted Average Cost of Capital (WACC); Marginal

Cost of Capital.

Project  Finance:  Project  Planning  –  Preparation  of  Project  Report,  Project

Appraisal

under

Normal

Inflationary  and  Deflationary

Conditions;  Project

Appraisal by Financial  Institutions  –  Lending Policies  and  Appraisal  Norms by

Financial

Institutions and

Banks; Project Review and Control; Social Cost and

Benefit Analysis of Project. Term loans from Financial institutions and

Banks; Lease and Hire Purchase Finance; Venture Capital Funds; Private Equity;

International Finance and Syndication of Loans, Deferred Payment Arrangements;

Corporate  Taxation  and  its  Impact  on  Corporate  Financing;  Financing  Cost

Escalation.

Dividend Policy:

Introduction- Types; Determinants and Constraints of Dividend Policy; Forms of

Dividend; Different Dividend Theories.

Working Capital: Meaning, Types, Determinants and Assessment of Working

Capital Requirements, Negative Working Capital;  Operating Cycle Concept and

Applications of Quantitative Techniques; Management of Working Capital – Cash

Receivables  Inventories; Financing of Working Capital; Banking Norms and Macro

Aspects; Factoring and Forfaiting