Course Title FINANCIAL MANAGEMENT

Course Type Core

Course Nature Hard

Credit Units 4

Course Level UG (BBA)

Course Code MCH 210

Units Weightage
I 25%
II 25%
Syllabus
III 25%
IV 25%
TOTAL 100%

OVERVIEW

Every decision that a firm makes has a finance component to it. Thus, finance includes all
of a firms decision that has financial implications. It broadly includes Investment
Decisions, Financing Decisions & Management of Current Assets Decisions. These
decisions, of course, have the implications on the firms market/share value.

As a finance manager, one has to take the above decisions. The objective of this course
is to provide a conceptual framework necessary to understand financial issues and the
techniques to manage them efficiently and effectively. One may choose a career in
manufacturing sector, non-governmental or services sector, investment banks,
management consultancy etc, the learning of the art of finance is a must.

COURSE OUTLINE

UNITS CONTENT
UNIT - 1 Overview, Time Value of Money; Cost of Capital
UNIT - 2 Capital Budgeting
UNIT - 3 Working Capital Management
UNIT - 4 Capital Structure and Dividend Policy
Texts & References:

Main Text:
Fundamentals of Financial Management, 6e
- Chandra, Prasanna (McGraw Hill Pvt. Ltd.)

References:

1. Financial Management: Theory & Practice

Chandra, Prasanna (McGraw Hill Pvt. Ltd)

2. Essentials of Corporate Finance

Ross, Stephen A; Westerfield, Randolph W.; Jordan, Bradford D.
(McGraw Hill Irwin)

3. Essentials of Financial Management, 4e

-- Pandey, I M (Vikas Publishing House)

4. Corporate Finance and Investment

-- Pike, Richard; Neale, Bill (Prentice Hall)

5. Financial Management & Policy

-- Horne, James C Van (Prentice Hall)

6. Essentials of Corporate Finance

-- Ross, Stephen A; Westerfield, Randolph W; Jordan, Bradford D.
(McGraw Hill Pvt. Ltd.)

7. Corporate Finance: Theory & Practice

-- Damodaran, Aswath (John Wiley & Sons)

8. Principles of Corporate Finance

-- Brealey, Richard A; Myers, Stewart C (McGraw Hill Pvt. Ltd.)

9. Financial Management
-- Khan, M Y; Jain, P K (McGraw Hill Pvt. Ltd.)

Newspapers/ Journals/ Magazines

Economic Times, Business Line, Business Standard, Journal of Finance, Business India,
Business Today, Capital Market

Pedagogy

The teaching methodology is a judicious blend of lectures, real life situation analysis, case
discussion and presentation.

Assessment
Assignment; Class Participation; Conceptual Clarity; Presentation; Case Study; Mid-term
Exams, End-term Exam
Session Plan

Specific Readings /
Session(s) Topic(s) References
Overview, Time Value of Money, Cost of
UNIT 1
Capital
Overview of financial management Introduction
1-2 to finance Ch 1 Chandra

Time value of money: Future value, compounding,

present value, Discounting, Annuities, Perpetuity,
3-8 Ch 8 Chandra
Case Analysis

Cost of Capital : Cost of debt, equity, preference

shares, determining the proportions, weighted
9-13 average cost of capital, determining the optimal Ch 14 Chandra
capital budget, Case Analysis

UNIT 2 Capital Budgeting

Capital budgeting process, Project classification,
Investment criteria, Net present value, Benefit
cost ratio, Internal rate of return, Payback period,
14- 21 Ch 11-12 Chandra
Discounted payback period, Accounting rate of
return, Case Analysis

UNIT 3 Working Capital Management

Working capital Management: Inventory
management; Cash management, Credit
22-31 Ch 22-25 Chandra
management

UNIT 4 Capital Structure; Dividend Policy

Leverages: Operating, Financial, Combined
32-33 Ch 12 I M Pandey
Capital structure: Traditional position, Net income
approach, Net operating income approach, ,
34-38 Modigliani and Miller position, ROI-ROE Analysis, Ch 15 Chandra
EBIT-EPS analysis

Dividend Policy: Traditional Position, Walter

Model, Gordon Model, MM Position, Determinants
39-42 Ch 17 Chandra
of Dividend Policy

Case study & Numerical

43-44 Ch 15-17 Chandra
(The Session plan is indicative)

Date and Timings of Submission

Timings shall be announced in the class at the appropriate time. All submissions must be
done to the concerned faculty teaching the course. Late submissions will not be accepted.
Students are advised to use Bloomberg Terminals for real time data.