Financial Management

Paper Code: 
MTM 225
Credits: 
4
Contact Hours: 
60.00
Max. Marks: 
100.00
Objective: 

 

Course Objectives:

This course will enable the students to –

  1. Develop an insight in the field of Financial Management
  2. Equip the student with basic knowledge required for financial decision making.

 

Course Outcomes:

Course

Course outcome (at course level)

Learning and teaching strategies

Assessment Strategies

Paper Code

Paper Title

MTM 225

Financial Management

CO 1Acquaint with the arena of Financial Management and apply concepts of discounting and compounding to solve practical problems.

CO 2Discuss the concept of risk and return, Cash Management, Marketable Securities Management, Receivables Management and Inventory Management.

CO 3Calculate working capital requirements and Cost of Capital of a Company.

CO 4Apply Capital Budgeting techniques to evaluate a project proposal.

CO 5Identify the significance of Leverage; basics of Capital Structure and Dividend policy.

 

Approach in teaching:

Interactive Hours, Group Discussion, Tutorials, Case Study

 

Learning activities for the students:

Self-learning assignments, presentations

Class test, Semester end examinations, Quiz, Assignments, Presentation
 

 

 

12.00
Unit I: 
UNIT I

Meaning, Nature, Scope, Importance and Objectives of Financial Management; Functions of a chief financial officer; Sources of finance- Long term and Short term; Indian financial system-structure and functions.

Time value of money-Compounding and Discounting concept and its applications

12.00
Unit II: 
UNIT II

Risk and Return – Risk of a single asset, portfolio theory and risk diversification, Systematic and unsystematic risk, Capital Asset pricing model (CAPM)- Assumptions, CAPM equation, Security Market line (SML)

Cash and Marketable securities management- Meaning and Principles of cash management; 

12.00
Unit III: 
UNIT III

Management of working capital- Meaning, Estimation of working capital requirements, Working capital financing by banks;

Receivables management- Meaning and importance;

Inventory management- Meaning, objectives and techniques-Economic order quantity, Re-order point, Fixing stock levels.

12.00
Unit IV: 
UNIT IV

Cost of Capital- Meaning, Cost of Debt, Preference and Equity Capital, Weighted average cost of capital;

Capital Budgeting: Concept, need and objectives; Methods of Capitalbudgeting –Average Rate of Return, Payback period, Net present value, Internal Rate of Return, Profitability Index.

12.00
Unit V: 
UNIT V

Leverage: Meaning, types of leverages and their significance;

Capital Structure-Meaning, considerations in capital structure planning, value of firm and capital structure;

Dividend Policy- Meaning, Factors affecting dividend decisions, Alternative forms of dividends, Types of dividend policies, Dividend policy models-Assumptions and criticism

Essential Readings: 

Suggested Readings-

  • I M Pandey “Financial Management”, Vikas Publications
  • Sheeba kapil, Fundamentals of Financial Management, Pearson
  • Chhandra Prassana, Financial Management, Tata McGraw Hill
  • Khan & Jain, “Financial Management”. Tata McGraw Hill, New Delhi
  • Brigham Houston, Fundamentals of Financial Management, Cengage Learning.
  • Van Horne, Financial Management, PHI
  • Rustagi R.P, Fundamentals of Financial Management, Taxmann

 

Academic Year: 
2020-2021
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