Semester II
Course Code: Name of the Course: Corporate Finance II
Teaching Scheme (Hrs./week) Examination/Evaluation Scheme
TH P TUT Continuous Assessment 40
4 - - Mid-Semester Exam/Evaluation NA
Credits Assigned End-Semester Exam/Evaluation 60
TH P TUT Practical/ Oral/ Practical + Oral Exam -
4 - - Programme Outcome Mapped 02, 05
Teaching Pedagogy : heory and numericals with examples,
T
Interactive classroom sessions with the help of
PowerPoint presentations, case study and case
discussions, chalk and talk method
Modules at a Glance
r.
S Modules/Units o of
N
No. Hours
1 Capital Budgeting 15
2 Budgetary Control 15
3 Economic Value added and Market Value added 15
Corporate Restructuring
4 1 5
Total 60
Course Prerequisite: Not Applicable
LEARNING OBJECTIVES:
( 1) o recognize different capital budgeting techniques
T
(2) Develop an understanding of the budgeting process
(3) Analyze a company’s statement of equity and retained earnings
(4) Understanding the process of corporate restructuring
COURSE OUTCOMES:
O1: Students will be able to appraise different projectswith relevant capital
C
budgeting techniques.
CO2: Learners will learn to Manage budgets withindepartment, division, cost or
profit centre.
CO3: Students will learn the valuation method.
CO4: Students will understand economical, financial,and strategic reasons used for
corporate restructuring transactions.
Course Content
Unit O
C
Description Hours
No. No
I Capital Budgeting 15 1
● Introduction - Capital Budgeting Process, Project
Classification and Investment Criteria.
● Techniques of Capital Budgeting - NPV, Benefit Cost
Ratio, Internal Rate of Return, Modified Internal Rate of
Return, Payback period, Discounted Payback Period and
ARR. (Inclusive of Estimation of Project Cash Flows)
● Capital Rationing – Meaning, Need and Dealing with
Capital Rationing Problems
II Budgetary Control 15 2
● M eaning and objectives, advantages and limitations of
budgets
● Functional budgets, fixed and flexible budgets
● Zero based budgeting, performance budgeting
● Practical problems of preparing flexible budgets and
functional budgets
III Economic Value added and Market Value added 15 3
● Introduction, Background, Significance, advantages and
disadvantages,
● EVA and MVA calculation using simple practical problems
IV Corporate Restructuring 15 4
● M eaning, Types, Limitations of Merger, Amalgamation,
Acquisition, Takeover, Determination of Firm’s Value
● Effect of Merger on EPS and MPS, Pre Merger and Post
Merger Impact (Simple Practical Problem)
● Distressed asset under insolvency and securitization with
simple practical problems on NPA.
Paper Pattern
Internal Evaluation
ontinuous Assessment- Assignments, Class participation,
C 40 marks
Presentation, Practical, Viva, Test/ quiz (minimum three assessments
to be conducted)
Mid-Semester Test NA
End Semester Examination (60 marks) - Paper Pattern
Note:
1) Q uestion no 1 is compulsory with conceptual/ practical
problem questions.
2) All questions carry equal marks.
Q1. Practical/ conceptual questions 15 marks
(3 questions of 5 marks OR 5 questions of 3 marks)
Questions should be a blend of all Units
a)
b)
c)
15 marks
Q2. (Question from Unit 1)
OR 15 marks
Q2. (Question from Unit 1)
15 marks
Q3. (Question from Unit 2)
OR 15 marks
Q3. (Question from Unit 2)
15 marks
Q4. (Question from Unit 3)
OR 15 marks
Q4. (Question from Unit 3)
ach question can be subdivided into two or three sub-questions
E
/conceptual questions as per requirement of the course
References Books:
F oster, George Financial Statement Analysis, 2nd ed., Pearson Education Pvt Ltd
●
● Damodaran, A. (2008). Damodaran on Valuation, Security Analysis for Investment and
Corporate Finance (2nd ed.). Wiley India Pvt. Ltd.
● Chandra, P. (2011).Corporate Valuation and Value Creation, (1st ed). TMH
● Weston, Chung, Hoag, Mergers, Restructuring and Corporate Control, Prentice Hall Of India.
● M.Y. Khan and P.K. Jain - Financial Management - Tata - McGraw Hill Publishing co. Ltd., New
Delhi. 6. Prasanna Chandra - Financial Management - Tata - McGraw Hillls
● Financial Management, M Pandey, Pearson
● Fundamentals of Financial Management, Dr. R.P. Rustagi, Taxmann
