Message

Dear 18MBAs and MBAIBs

It is a matter of pleasure for me to welcome you once again to another course that I shall take in II
semester of 2018 – 19 session
I shall cover Unit III and IV of Financial Management. Prof M Khalid Azam must have covered /
will cover I, II and V Units of this course
I plan to engage 7-8 classes in each unit with additional classes if required / desired by you
All teaching material, numerical and their solution shall be emailed to you in due course
As it has always been, I am a phone call / text / WhatsApp / email away.
Wishing you pleasant studies and all the best

Financial Management – Day-wise teaching schedule, Session 2018-19

Days Topics for Unit III and IV Date
Covered
Unit III Investment Decisions (Capital Budgeting)
01 Justification of studying Finance and Introduction to Financial Management
02 Introduction to Capital Budgeting, its importance, accounting profit and cash flow,
concept of relevant inflows,
03 Calculations and illustration on relevant inflows for decision making
04 Techniques of appraisal; Concepts and relevance of Traditional methods (Payback
Period Method and Accounting Rate of Return Method) Discounted Cash Flow
Methods (NPV, IRR and PI Methods), introduction to assessment of risk in CB
05 PBP Method and its Merits and Demerits (Illustration), ARR and its illustration,
merits and demerits, use of MS Excel in calculations of PBP and ARR
06 NPV Method, its illustration and limitations, practice session
07 IRR Method, its calculation and limitations, PI Method and illustration
08 Comparison between IRR and NPV, Risk analysis in CB Decisions
Unit IV Financing Decisions (Cost of Capital)
09 Introduction to Cost of capital and capital structure, rationale and relevance with
shareholders value, types of capital and calculation of cost of various sources of
financing
10 Calculation of Cost of Debt – Illustration
11 Calculation of Cost of Preference Shares – Illustration, Rationale of Cost of Equity
and its calculations, dividend model and pricing of shares
12 Cost of retained earnings and rationale, Weighted Average Cost of Capital, exercise
13 Concept and illustration of Financial Leverage, exercise
14 Degree of Financial Leverage and its use, optimum FL, exercise
15 MM Hypothesis and value of a firm

Pandey IM, Essentials of Financial Management, 2017, Vikas Publishing House, NOIDA
Class notes shall be sent via email as and when required

Notes: (1) It is recommended to have a separate note book for this subject (2) You may post any inquiry in
the subject thru SMS / WhatsApp @ 9412 333 586 / javedmba@hotmail.com ID (3) Completion of given
assignments is a prerequisite for any concession (4) Reply will be sent to only those whose cell no. / email ID
is registered with me and text contains his details like name and roll no. SMS / call from unknown number
will not be replied