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FM - 2018 Syllabus New

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FM - 2018 Syllabus New

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Course FINANCIAL Course 18MBA2PCFM SEE 3 Total No.

MANAGEMENT Code Duration Hours of Lecture


Hours
Credits 04 L-T-P 4-0-0 CIE + 50+
48
SEE 50

UNIT I (Theory & problems) (12 hours)


Financial Management: Introduction to financial management, objectives of financial
management –profit maximization and wealth maximization.
Indian financial system : Structure & functions of Indian financial system, Significance of
Primary and secondary markets and its instruments, Derivatives, Behavioral Finance, Venture
Capital, Financial Modelling.
Raising of Long term sources of financing: Shares, Debentures, Retained earnings and
Term loans.

Working capital Management:


Introduction, Factors, Policy, Determination of operating cycle and cash cycle, Estimation of
working capital requirements of a firm (Does not include Cash, Inventory & Receivables
Management).

UNIT II (Theory & problems) (10 hours)


Time value of money: Simple interest & Compound interest, Concepts of Future value&
Present value of single cash flow & annuities & perpetuity, Effective interest rates, loan
amortization.

UNIT III (Theory & problems) (10 hours)


Investment decisions: Introduction, Need, Capital budgeting process, Investment evaluation
techniques –Payback period, accounting rate of return, Net present value, Internal rate of
return, Profitability index & discounted payback period. Estimation of cash flow for new
project & replacement projects.

UNIT IV (Theory & problems) (08 hours)


Cost of Capital: Basic concepts, Cost of debenture capital, cost of preferential capital, cost
of term loans, cost of equity capital (Dividend discounting and CAPM model). Cost of
retained earnings. Determination of Weighted average cost of capital (WACC) and Marginal
cost of capital.

UNIT V (Theory & problems) (08 hours)


Capital structure and dividend decisions – Designing the capital structure. (No capital
structure theories to be covered) Leverages – Determination of operating leverage, financial
leverage and total leverage.
Dividend policy – Factors affecting the dividend policy - dividend policies- stable dividend,
stable payout (No dividend theories to be covered).

(QUESTION PAPER- 60% Problems, 40% Theory)

Course outcomes:
CO1: Ability to understand the basics of financial environment

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CO2: Ability to imbibe the knowledge of financial management theories and practices to
solve business problems.
CO3: Ability to develop analytical and critical thinking skills of financial decisions by
associating tools and techniques for data based decision
CO4: Ability to communicate the various aspects of financial management.

RECOMMENDED BOOKS:
1. Financial Management by Prasanna Chandra, 9/e, McGraw-Hill publications, 2014.
2. Financial Management Pandey I M, Vikas publication house Pvt Limited, New Delhi, 10 th
edition,2010
3. Financial Management by Khan M Y& Jain P K , 6/e, McGraw -Hill publication, 2014

REFERENCE BOOKS: 
1. Fundamentals of Financial Management, Brigham & Houston, 12/e, Cengage Learning,
2009.
2. Financial Management A Step-by-Step Approach – N.R.Parasuraman, 1/e, Cengage,
2013.
3. Financial Management, Sheeba Kapil, 2/e, Pearsons Publication, 2016.

MOOCs : Introduction to Time Value of Money – https://www.coursera.org/learn/time-value-money

Indicative Course Assignments:

1. Analysing Time value concepts using Excel.


2. Capital budgeting, Capital structure, dividend decision, working capital practices in India

CO-PO Matrix:

CO/PO PO1 PO2 PO3 PO4 PO5 PO6 PO7


CO1
CO2 Y
CO3 Y
CO4 Y

44

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