Financial Management

Paper Code: 
BCS 217
Credits: 
06
Contact Hours: 
90.00
Max. Marks: 
100.00
Objective: 

Course Objectives:

 To acquire knowledge of practical and procedural aspects relating to Financial Management.

 Course Outcomes (COs):

BCS 217

Financial
Management

CO 62:Apply financial management concepts and tools to the decisions faced by a manager in investment decisions.       

CO 63:Prepare a project and evaluate the sources of financing the project

CO 64:Appraise the risk profile of firms; specifically, estimate the costs of capital, including debt and equity capital using financial data

CO 65:Analyze capital budgeting problems using different techniques, including net present value, internal rate of return and modified internal rate of return

CO 66:Demonstrate the importance of working capital management and the tools to manage it

CO 67:Review and perform the security analysis and portfolio management

Approach in teaching:
Interactive Lectures, Discussion, Tutorials, assignments.
Learning activities for the students:
Self learning assignments, Effective questions,  solving case studies

Class test, Semester end examinations, Quiz, Solving problems in tutorials, Assignments,  Individual projects

 

18.00
Unit I: 
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.

 

18.00
Unit II: 
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.

 

18.00
Unit III: 
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.

 

18.00
Unit IV: 
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 Forfeiting .

 

18.00
Unit V: 
Security Analysis

Measuring of Systematic and Unsystematic Risk; Fundamental Analysis (Economic, Industry and Company); Technical Analysis and Efficient Market Hypothesis.

Portfolio Management: Meaning, Objectives; Portfolio Theory -Traditional Approach; Markowitz Portfolio Theory; Modern Approach - CAPM Model; Economic Value Added; Sharpe Single & Multi Index Model; Risk Adjusted Measure of Performance.

 

References: 

1. Study Material Published by ICSI

2. Scanner: Arun Kumar (ShuchitaPrakashans P Ltd)

 

Academic Year: 
2021-2022
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