Finance Major Subject Index (3rd Sem)

FINANCE MAJOR

FINANCE MINOR

LEGAL ASPECTS OF BUSINESS

SECURITY ANALYSIS & PORTFOLIO MANAGEMENT

MERCHANT BANKING & FINANCIAL SERVICES

MERCHANT BANKING & FINANCIAL SERVICES

SECURITY ANALYSIS & PORTFOLIO MANAGEMENT

MERGERS & ACQUISITIONS

MERGERS & ACQUISITIONS TAXATION MANAGEMENT INTERNAL AUDIT & CONTROL FUNDAMENTAL ANALYSIS & FINANCIAL DERIVATIVES

IB MINOR

BANKING & WEALTH MANAGEMENT

BASICS OF INTERNATIONAL BUSINESS SHIPPING & LOG MGMT FOREIGN TR POLICY & PROCEDURE

1

I - Legal Aspects of Business Unit 1

Law of Contract Introduction, Objective Law of Contract - Indian contract Act 1872 Offer or Proposal Acceptance Contractual Capacity Free Consent Consideration Privity of Contract Lawful Object

Unit 2

Discharge of Contract Introduction, Objective Ways of Discharge of Contract Remedies for Breach

Unit 3

Contract of Indemnity & Guarantee Introduction Contract of Indemnity Contract of Guarantee

Unit 4

Negotiable Instruments Act Introduction Negotiable Instruments Act Definition & Features Parties to Negotiable Instruments Negotiation of Negotiable Instruments Definition, modes of negotiation Dishonour and Discharge

Unit 5

Companies Act Introduction Companies Act - 1956 Types of companies Formation for a Company Share Capital Company Management Meetings

Unit 6

Information Technology Act - 2000 Introduction Overview of the Act What does IT Act enable? Why Cyber Law in India?

Unit 7

Arbitration and Conciliation Act - 1996

2

Introduction Scheme of the Act Objectives of the Act Power of Judicial Authority to refer parties to Arbitration Composition of Arbitral Tribunal Jurisdiction of Arbitral Tribunal Conduct of Arbitral Proceedings Award Conciliation Mediation Negotiation Unit 8

The Consumer Protection Act - 1986 Introduction Rights of Consumers Consumer complaint Unfair Trade Practices Restrictive Trade Practices Consumer Disputes Redressal Agencies Consumer Protection Councils

Unit 9

The Shops and Establishment Act Introduction Scope and Coverage of the Act Provisions Relating to shops Provisions Relating to Establishments Obligations and Rights of Employers and Employees

Reference Books: • Legal aspects of business by Pathak, Akhileshwar • Business law including company law by Gulshan,S.S

3

II - Merchant Banking and Financial Services Unit 1: An Introduction to Merchant Banking • Meaning of Merchant Banking • Nature of services • Structure of merchant banking firms • Financial Markets: Capital markets-Money market- Forex markets. Linkages between the markets Unit 2: Merchant Bankers and SEBI • SEBI guidelines for merchant bankers • Issue Management-equity issues, rights issues, debenture issues, Book building, • Private placement: Pre issue and post issue activities • Raising of capital from international markets: Loan syndication, ADRs, GDRs, EDRs, ECB, IDR Design of Capital structure—pricing of issues. Unit 3: Financial Services • Fund based and fee based services • Credit rating – Meaning and Definition • Process of credit rating of financial instruments • Depositary services • Role of depositories • A brief discussion on performance of NSDL and CSDL • Stock Broking Services including SEBI guidelines: Unit 4: Money Markets • Instruments with their features including treasury bills, commercial bills, commercial papers, certificate of deposits and gild-edged securities. • Money Market, Mutual Funds • Bills Discounting, Factoring, Forfeiting. Consumer finance, credit cards, vehicle financing and consumer durable financing. Unit 5: Lease Financing • Meaning and types • Historical perspective • Present legislative frameworks of leasing, lease & taxes • Lease evaluation form lessor and lessee’s point of view Unit 6: Hire Purchasing • Concept and characteristics • Hire purchase V/s Lease • Condition and warranties in leasing and their implications, tax implications of hire purchasing. • Evaluation of hire purchasing from hirer & hiree’s angle 4

Unit 7: Securitization of Debt • Meaning • Features • Special Purpose Vehicle • Pass Through Certificate & mechanism. Unit 8: Marketing of Financial Services • Conceptual framework • Distribution • Pricing • Promotion • Attracting & retaining customers • Segmentation • Positioning • Development and launching of new products • Behavioral profile of customers

Reference Books: • Merchant Banking and Financial Services by Guruswamy

5

III-Security Analysis & Portfolio Management Unit 1: Investment – A Conceptual Framework • Introduction • Meaning of Investment • Financial and Economic Meaning of Investment • Investment and Speculation • Investment and Gambling • Significance of Investment • Features of an Investment Programme • The Investment Process • Risks of Investment • Common Errors in Investment Management • Qualities of a Smart Investor Unit 2: Investment Environment • Introduction • Financial Market • Money market – features and composition • Capital Market – features and composition • Stock Exchanges: NSE , BSE and OTCEI • Stock Market Indices • Money Market Instruments • Capital Market Instruments • Financial Derivatives • Financial Intermediaries Unit 3: Fundamental Analysis • Introduction and Meaning • Factors to be considered in Economy Analysis • Economic Forecasting and Technique • Leading Coincidental and Lagging Indicators • Industry Analysis • Industry Growth Cycle • Factors Affecting Industry Performance • Practical Exposure of an Industry Analysis • Techniques of Industry Analysis • Company Analysis • Need • Factors to be Analyzed in Company Analysis • Chemistry of Earning • Case Study – for Company Analysis • Examples of Company Analysis • Intrinsic Value of Securities

6

Unit 4: Technical Analysis • Meaning and Basic Tenets • Tools of Technical Analysis • Dow Theory • Charting as a Technical Tool • Important Chart Formations or Price Patterns • Fundamental and Technical Analysis – A Comparison • Technical Indicators Unit 5: Efficient Market Hypothesis • Introduction • Concept “Efficient Market” • Random Walk Theory • Assumption of Random Walk Theory • Random walk and Efficient Market Hypothesis (EMH) • Forms of Market Efficiency • Empirical Tests of EMH • Misconception about EMH with Answer • The Random walk model – Technical Analysis and Fundamental Analysis. • Implication of EMH on Security Analysis and Portfolio Management • Critique of EMH Unit 6: Bond and Share Analysis and Valuation • Introduction • Elements of Investment • Basic valuation Models – Fundamental Approach • Valuation of Bonds or Debentures • Price-yield Relationship • Risks in Debt • Duration of Bonds • Duration and Immunization • Bond Portfolio Management • Value of Preference Share • Equity Valuation • Equity Portfolio Management Unit 7: Portfolio Management – Risk and Return • Introduction • Concept of Portfolio and Portfolio Management • Concept of Risk and its types in Portfolio Management • Risk Diversification • Measurement of Portfolio Return. • Measurement of portfolio risk • Optimal Portfolio 7

Unit 8: Markowitz Portfolio Selection Model • Introduction to Concept Portfolio Analysis and Diversification of Risk • Assumption of Markowitz Model • Efficient Frontier or Set • Choosing Optimum Portfolio as per Markowitz • Markowitz Diversification and Parameters • Dominance Criteria and Corner Portfolio • Modification to Efficient Frontier (Leveraged Portfolio) • Criticism to Markowitz Model • Solved Problems Unit 9: Sharpe: The Single Index Model • Introduction • Measurement of return on a individual stock • Measurement of Portfolio Return. • The Characteristic Line • Measurement of Individual Stock Risk • Measurement of Portfolio Risk • Portfolio Risk Components and Risk Diversification • Measurement of Return on an Individual Stock using Regression Equation • Optimal Portfolio – Cut off Rate Unit 10: Capital Asset Pricing Model (CAPM) • Introduction and Assumptions of CAPM • Separation Theorem • Market Portfolio • The Efficient Set or Frontier • The Capital Market Line (CML) • The Security Market Line (SML) • Inputs required for applying CAPM • Adjusting Historical Beta • Other Approaches to Beta Estimation • Market and Non-market Risk • Selected Problems Unit 11: Factor Models and Arbitrage Pricing Theory • Introduction • Single Factor Model and Variance • Two Factor Model and Variance • Practical Exposure to Factor Models • Arbitrage Pricing Theory (APT) • Principle of Arbitrage or Arbitrage Theory • Graphical Representation of APT • Model of APT 8

• • • •

Assumptions of the Model Practical Exposure Extension of Arbitrage to Two Factor Model Selected Problems

Unit 12: International Portfolio Investments • Introduction • Foreign Portfolio Investment: As an Alternative Source • Investment Avenues to Foreign Portfolio Investors − Country Funds − American Depository Receipts − Global Depository Receipts • International Equity Indices • Emerging Markets • International Diversification • Risk and Return from Foreign Investing • International Listing

Reference Books: • Security analysis and portfolio management by Kevin, S • Security analysis and portfolio management by Fischer,Donald E

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IV - Mergers and Acquisitions Unit 1: Introduction • Meaning • Types and characteristics • Motives behind mergers • Theories of mergers operating, financial and managerial synergy of mergers • Role of industry life cycle • Value creation in horizontal, vertical and conglomerate mergers – change forces contributing to M & A activities Unit 2: M & A – A strategic perspective • Merger Process • Five-stage model -due diligence (detailed discussion) • Methods of financing mergers-Cash offer, Share exchange ratio • Mergers as a capital budgeting decision Unit 3: Corporate restructuring • Meaning and Definition • Different methods of restructuring joint ventures • Sell off and spin off • Divestitures • Equity carve out • Leveraged buy outs (LBO) • Management buy outs • Master limited partnerships • Employee stock ownership plans (ESOP) Unit 4: Valuation • Meaning and valuation approaches • Discounted cash flow valuation • Relative valuation • Valuing operating and financial synergy • Valuing corporate control • Valuing of LBO Unit 5: Process of merger integration • Organizational and human aspects • Managerial challenges of M & A Unit 6: Accounting for amalgamation • Pooling of interest method • Purchase method • Procedure laid down under Indian companies act of 1956 10

Unit 7: Take over defenses • Financial defensive measures • Coercive offers and defense • Anti-takeover amendments • Poison pill defense Unit 8: Legal and regulatory frame work of M & A • Provisions of Company’s Act 1956, • Indian Income Tax act 1961 • SEBI take over code, Provisions of Competition Act.

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V - Taxation Management Part A: Direct Taxes Section 1 - Income Tax and Corporate tax Unit 1: Basics of taxation management • Tax planning, Tax management and tax costing • Tax avoidance and tax evasion Unit 2: Basic concepts of Income tax • Taxable event under Income Tax Act • Incidence of income tax- tax management and planning • Residential status- tax management and planning Unit 3: Different sources of income • Categorization of income as per Act • Agriculture income • Excluded/exempted income Unit 4: Remuneration to employees and tax planning • Salaries-important provisions of the Act, • Tax planning and management as to salaries − by employees − by employers Unit 5: Income from business or profession • Important provisions as to business/professional income − deductible expenses − depreciation − deductions from income − set off and carry forward of losses • Tax management and planning as to business income Unit 6: Other sources of income • Rental income • Capital gains • Income from other sourcesUnit 7: Corporate Tax Management • Computation of income • rates of taxes, surcharge and cess • interest, advance tax and refunds, • Tax Collection and deduction at source 12

• Returns and due dates of filing of these Returns Section 2 -Fringe Benefit Tax Unit 8: Basic concept of FBT • Definition of terms • Incidence of tax Unit 9: Tax management as to FBT • Rates for FBT • Method of payment, • Returns and forms Part B: Indirect Taxes Section 3 - Customs Law Unit 1: Basic concepts of Customs Law • Taxable event, • Types of duties Unit 2: Classification and valuation • Meaning of classification • Principles of classification • Valuation-rules and methods Unit 3: Exemptions Draw Back, Incentives • Exemptions under Customs Law • Duty Drawback • Export incentives Section 4 - Central Excise Law Unit 4: Basic concept of Central Excise Law • Taxable event, • Definitions of terms used in the Act Unit 5: Valuation and Classification • Rules of classification • Rules as to valuation Unit 6: Cenvat Credit • Meaning and nature • Method of obtaining cenvat credit 13

• Tax management and planning as to cenvat credit Unit 7: Special provisions applicable • SSIs and central excise • Exporters and central excise Section 5 - Service Tax Unit 8: Basic concepts Service Tax • Taxable event • Important terms defined in the Act Unit 9: category of taxable services • Important categories • Exemptions under each category • Tax planning areas Unit 10: Tax Management under service tax • Rates of taxes • Returns to be furnished • Due dates for filing of returns Section 6 - VAT and CST Unit 11: Basic concepts of VAT and CST • Taxable event in VAT and CST • General terms used in VAT and CST • VAT credit –meaning and nature Unit 12: Tax management under VAT and CST • Procedures as to registration under VAT and CST • Method of tax payments, • Forms and Returns under VAT and CST

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VI - Internal Control & Audit Unit 1: An Introduction to Internal Control • Internal control-meaning & scope • Framework, principles of internal control • Features , components of internal control • SOX, COSO and COBIT and other benchmarks as to internal control Unit 2: Techniques of Evaluation of Internal Controls • ICQ and ICEQ • Flow-charts • Other techniques Unit 3: Practical Application of Internal Controls in Business • Internal control for–purchases • Internal control for sales • Internal control for cash and bank transactions • Internal control for fixed assets • Internal control for inventory • Internal control for payroll Unit 4: Financial Reporting and Internal Control • Provisions of Companies Act • Corporate Governance Code of SEBI of India • SOX and internal control • Other financial reporting standards as to internal control Unit 5: Accounting Standards and Internal Control • GAAPs and financial reporting • Indian GAAP and Accounting Standards of ICAI • International Accounting Standards Unit 6: Basics of Audit • Meaning, nature of audit • Significance of audit • Internal audit -meaning and features • Comparison of internal audit with Statutory audit • Management consultancy and audit • Investigation and audit • Types of audit Unit 7: Standards as to Audit • Accounting Standards and Audit • Auditing Assurance Standards 15

• Qualities of an auditor Unit 8: Audit Evidence • Meaning and nature • Techniques for obtaining evidence • Audit Procedures-Compliance and Substantive Procedures • Materiality and audit risks • Audit techniques • Analytical procedures- use of ratio analysis in auditing Unit 9: Sampling in Audit • Need for sampling • Sampling risks • Sampling plans • Sampling methods Unit 10: Frauds and Errors • Meaning and types of errors • Meaning and types of frauds • Responsibility for fraud or error • Symptoms of frauds • Management frauds Unit 11: Investigations and Special Audits • Meaning and types of investigations • Companies Act provisions • Forensic accounting and investigations Unit 12: Audit Reports • Types of audit reports • Contents of audit reports • Significance of audit reports • CARO-its contents and importance. Unit 13: Audit Practice Management • Audit- plans • Audit programmes • Documentation of audit • Quality aspects of audit

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VII - Fundamentals Analysis & Fin. Derivatives Module - 1 - Fundamental Analysis Session 1 • Indian Economy - World Economy & Economic Reform Process Session 2 • Capital Markets • Debt Market • Stock Market - Primary Market / Stock Market • Need of Equity Analysis • Equity Analysis • Sourcing & Interpretation of Fundamental Data • Analyzing Financial Data • Profit & Loss A/c / Balance Sheet • Growth patterns & analysis • Ratios / EPS • Bonus & Splits Session 3 • Company Categorization • Blue Chips / Mid Caps / Small Caps • Growth Stocks / Momentum Stocks / Trading Stocks / Dividend yield Stocks Session 4 • P/E Ratio • Index Analysis & Valuation Session 5 • Introduction to Sector Analysis Session 6 • Detailed Sector Analysis Session 7 • Introduction to Macro Economics Session 8 • Mutual Funds Module - 2 - Basics of Derivatives Session 1 1. Birth of Derivatives 17

Market players, Liquidity Delivery Mechanizm of Shares Fear of loosing the money Psychology of the Trades & Investors Buy now & sell tomorrow Definition 2. Types of Derivatives Futures & Options Commodity Markets, Currency Markets Interest Rate futures, Credit Derivatives History of Futures Markets

3. Futures Concept of Futures Expiry of Contracts Market Lots Examples of Actual Trades Mark to Market Daily Settlement 4. Arbitrage Cost of Carry Advantage of Cost of Carry Buying in Spot & Selling in Futures Covered Positions 5. Uncovered or Naked positions Futures trading without buying Equities Session 2 1. Options Strike Price, Premium Types of Options Call Option & Put Option At the Money Option Out of the Mondy Option In the Money Option 2. Call Option Definition a) Call Option Buyer b) Call Option Seller

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3. Put Option Definition a) Put Option Buyer b) Put Option Seller 4. Hedging Definition Actual examples 5. Open Interest Market Wide Limit Session 3 1. IMPLIED VOLATILITY Percentage (IV%) Call IV% Put IV% PCR (Put to Call Ratio) 2. Strike Price Selection Risk of Covered & Uncovered Options 3. Time Value for the Options Session 4 1. STRATEGIES • Arbitrage / Simple Hedging / Synthetics Options • Straddles - Long Straddle / Short Straddles • Strangles - Long Straddle / Short Straddle • Bull Call Spread / Bull Put Spread

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VIII - Banking & Wealth Management 1. What is Banking/ The traditional role of banks. 2. Difference between Retail Banking, Corporate Banking and Investment banking 3. Income streams for banks: Spread (defn) and fee based incomes 4. Definition of Savings Account, Current Account, Deposits 5. Asset and Liabilities in a bank ba;lance sheet 6. Different departments and their respective roles: a> Customer Service b>MIHU c>Tellers d>Branch Banking e>Priority Banking f>Wealth Management g> Retail Assets h> Retail Liabilities/ CAT 7. Products: definition and explanation a>Home loans b>Personal Loans c>credit Cards d>Mutual Funds ( To be explained later in greater details) e> Insurance ( To be explained later in greater details) f> PMS g> Structured Products h> FCNR/ NRE / NRO defined 8. Important operational functions defined: a> RTGS b> High value clearing c> Normal Clearing d> Telegraphic transfers & Repatriation e> Inward/ Outward remittance f > Treasury functions 9. Important Rates governing Bank operations and money supply a> Prime lending Rates b> Cash Reserve Ratio c> Statutory Liquidity Ratio d> Repo Rate e> Reverse Repo Rate

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f> Bank Rate 10. Primary Income Sources for the bank a> Income from lending: Home loans/ Personal loans/ Credit Cards/ corporate Loans b> Fee Bases Incomes: Sale of investment products (Bank and third party) 11. Wealth Management a> What is wealth managment? b> Role of a Relationship Manager : Acquisition/ Servicing/Selling c> Tools used: PFR d> Asset allocation e> Cross border norms / money laundering regulations f > Tracking markets g> Mutual Funds explained (Equity/ debt/ balanced & Income) h> Insurance: Details and difference between Life insurance (ULIP/endowment/ Term) and General Insurance i> Brief on Portfolio Management through direct stocks and customised structured products 12. Question & Answers

Reference Books: • Investment by Mayo,Herbert B • Investment management by Avadhani, V. A • Financial services by Khan M Y

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Finance Minor I - Merchant Banking and Financial Services Unit 1: An Introduction to Merchant Banking • Meaning of Merchant Banking • Nature of services • Structure of merchant banking firms • Financial Markets: Capital markets-Money market- Forex markets. Linkages between the markets Unit 2: Merchant Bankers and SEBI • SEBI guidelines for merchant bankers • Issue Management-equity issues, rights issues, debenture issues, Book building, • Private placement: Pre issue and post issue activities • Raising of capital from international markets: Loan syndication, ADRs, GDRs, EDRs, ECB, IDR Design of Capital structure—pricing of issues. Unit 3: Financial Services • Fund based and fee based services • Credit rating – Meaning and Definition • Process of credit rating of financial instruments • Depositary services • Role of depositories • A brief discussion on performance of NSDL and CSDL • Stock Broking Services including SEBI guidelines: Unit 4: Money Markets • Instruments with their features including treasury bills, commercial bills, commercial papers, certificate of deposits and gild-edged securities. • Money Market, Mutual Funds • Bills Discounting, Factoring, Forfeiting. Consumer finance, credit cards, vehicle financing and consumer durable financing. Unit 5: Lease Financing • Meaning and types • Historical perspective • Present legislative frameworks of leasing, lease & taxes • Lease evaluation form lessor and lessee’s point of view Unit 6: Hire Purchasing • Concept and characteristics • Hire purchase V/s Lease

22

• Condition and warranties in leasing and their implications, tax implications of hire purchasing. • Evaluation of hire purchasing from hirer & hiree’s angle Unit 7: Securitization of Debt • Meaning • Features • Special Purpose Vehicle • Pass Through Certificate & mechanism. Unit 8: Marketing of Financial Services • Conceptual framework • Distribution • Pricing • Promotion • Attracting & retaining customers • Segmentation • Positioning • Development and launching of new products • Behavioral profile of customers

Reference Books: • Merchant Banking and Financial Services by Guruswamy

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II - Security Analysis & Portfolio Management Unit 1: Investment – A Conceptual Framework • Introduction • Meaning of Investment • Financial and Economic Meaning of Investment • Investment and Speculation • Investment and Gambling • Significance of Investment • Features of an Investment Programme • The Investment Process • Risks of Investment • Common Errors in Investment Management • Qualities of a Smart Investor Unit 2: Investment Environment • Introduction • Financial Market • Money market – features and composition • Capital Market – features and composition • Stock Exchanges: NSE , BSE and OTCEI • Stock Market Indices • Money Market Instruments • Capital Market Instruments • Financial Derivatives • Financial Intermediaries Unit 3: Fundamental Analysis • Introduction and Meaning • Factors to be considered in Economy Analysis • Economic Forecasting and Technique • Leading Coincidental and Lagging Indicators • Industry Analysis • Industry Growth Cycle • Factors Affecting Industry Performance • Practical Exposure of an Industry Analysis • Techniques of Industry Analysis • Company Analysis • Need • Factors to be Analyzed in Company Analysis • Chemistry of Earning • Case Study – for Company Analysis • Examples of Company Analysis • Intrinsic Value of Securities

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Unit 4: Technical Analysis • Meaning and Basic Tenets • Tools of Technical Analysis • Dow Theory • Charting as a Technical Tool • Important Chart Formations or Price Patterns • Fundamental and Technical Analysis – A Comparison • Technical Indicators Unit 5: Efficient Market Hypothesis • Introduction • Concept “Efficient Market” • Random Walk Theory • Assumption of Random Walk Theory • Random walk and Efficient Market Hypothesis (EMH) • Forms of Market Efficiency • Empirical Tests of EMH • Misconception about EMH with Answer • The Random walk model – Technical Analysis and Fundamental Analysis. • Implication of EMH on Security Analysis and Portfolio Management • Critique of EMH Unit 6: Bond and Share Analysis and Valuation • Introduction • Elements of Investment • Basic valuation Models – Fundamental Approach • Valuation of Bonds or Debentures • Price-yield Relationship • Risks in Debt • Duration of Bonds • Duration and Immunization • Bond Portfolio Management • Value of Preference Share • Equity Valuation • Equity Portfolio Management Unit 7: Portfolio Management – Risk and Return • Introduction • Concept of Portfolio and Portfolio Management • Concept of Risk and its types in Portfolio Management • Risk Diversification • Measurement of Portfolio Return. • Measurement of portfolio risk • Optimal Portfolio 25

Unit 8: Markowitz Portfolio Selection Model • Introduction to Concept Portfolio Analysis and Diversification of Risk • Assumption of Markowitz Model • Efficient Frontier or Set • Choosing Optimum Portfolio as per Markowitz • Markowitz Diversification and Parameters • Dominance Criteria and Corner Portfolio • Modification to Efficient Frontier (Leveraged Portfolio) • Criticism to Markowitz Model • Solved Problems Unit 9: Sharpe: The Single Index Model • Introduction • Measurement of return on a individual stock • Measurement of Portfolio Return. • The Characteristic Line • Measurement of Individual Stock Risk • Measurement of Portfolio Risk • Portfolio Risk Components and Risk Diversification • Measurement of Return on an Individual Stock using Regression Equation • Optimal Portfolio – Cut off Rate Unit 10: Capital Asset Pricing Model (CAPM) • Introduction and Assumptions of CAPM • Separation Theorem • Market Portfolio • The Efficient Set or Frontier • The Capital Market Line (CML) • The Security Market Line (SML) • Inputs required for applying CAPM • Adjusting Historical Beta • Other Approaches to Beta Estimation • Market and Non-market Risk • Selected Problems Unit 11: Factor Models and Arbitrage Pricing Theory • Introduction • Single Factor Model and Variance • Two Factor Model and Variance • Practical Exposure to Factor Models • Arbitrage Pricing Theory (APT) • Principle of Arbitrage or Arbitrage Theory • Graphical Representation of APT • Model of APT 26

• • • •

Assumptions of the Model Practical Exposure Extension of Arbitrage to Two Factor Model Selected Problems

Unit 12: International Portfolio Investments • Introduction • Foreign Portfolio Investment: As an Alternative Source • Investment Avenues to Foreign Portfolio Investors − Country Funds − American Depository Receipts − Global Depository Receipts • International Equity Indices • Emerging Markets • International Diversification • Risk and Return from Foreign Investing • International Listing

Reference Books: • Security analysis and portfolio management by Kevin, S • Security analysis and portfolio management by Fischer,Donald E

27

III - Mergers and Acquisitions Unit 1: Introduction • Meaning • Types and characteristics • Motives behind mergers • Theories of mergers operating, financial and managerial synergy of mergers • Role of industry life cycle • Value creation in horizontal, vertical and conglomerate mergers – change forces contributing to M & A activities Unit 2: M & A – A strategic perspective • Merger Process • Five-stage model -due diligence (detailed discussion) • Methods of financing mergers-Cash offer, Share exchange ratio • Mergers as a capital budgeting decision Unit 3: Corporate restructuring • Meaning and Definition • Different methods of restructuring joint ventures • Sell off and spin off • Divestitures • Equity carve out • Leveraged buy outs (LBO) • Management buy outs • Master limited partnerships • Employee stock ownership plans (ESOP) Unit 4: Valuation • Meaning and valuation approaches • Discounted cash flow valuation • Relative valuation • Valuing operating and financial synergy • Valuing corporate control • Valuing of LBO Unit 5: Process of merger integration • Organizational and human aspects • Managerial challenges of M & A Unit 6: Accounting for amalgamation • Pooling of interest method • Purchase method • Procedure laid down under Indian companies act of 1956 28

Unit 7: Take over defenses • Financial defensive measures • Coercive offers and defense • Anti-takeover amendments • Poison pill defense Unit 8: Legal and regulatory frame work of M & A • Provisions of Company’s Act 1956, • Indian Income Tax act 1961 • SEBI take over code, Provisions of Competition Act.

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International Business Minor I - Basic (Fundamentals) Of International Business GLOBALIZATION: What is Globalization, Drivers of Globalization, Changing Demographics of Global Economics, Globalization Advantages and Disadvantages INTERNATIONAL BUSINESS ENVIRONMENT: Political System, Economic System, Legal System CULTURE: Religious, Social, Ethical, Social, Language, Education, Work culture INTERNATIONAL TRADE THEORIES: Benefits of Trade, Patterns of International Trade, Comparative Advantage Theory, Ricardian Theory, Heckscher Ohlin Theory, Product Life Cycle Theory, New Trade Theory, National Competitive Advantage – Porter’s Diamond

GLOBAL TRADE AND INVESTMENT ENVIRONMENT: Political Economy of International Trade, Instruments of Trade Policy, Foreign Direct Investment, Regional Economic Integration GLOBAL MONETARY SYSTEM: Foreign Exchange Markets, International Monetary System, Global Capital Markets INTERNATIONAL BUSINESS OPERATIONS: Import Export Counter Trade, Incoterms & implications, Letters of Credit. REFERENCE BOOKS: International Business Management By Francis Cherulinilum International Business By Charles HIll International Marketing By Philip Cateora and John Graham

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II - Shipping & Logistics Management 1. International Shipping: Introduction, Types of cargo, Types of Shipping services, Types of ships, Conferences, Hub & Spoke operations, Multimodal Transport.

2. Liner Shipping: Types of containers, important aspects, abbreviations, 3. ICD: Concept & operations 4. Export & import operations & documentation for Indian customs, CHA, C&F Agent, Freight Forwarder, NVOCC, Consolidator 5. Components of Freight rates, Pricing 6. Bill of Lading: Types of BL, Related terms & conditions, Overview of Hague / Hague Visby rules 7. Shipping / documentation implications of LCs & Incoterms, Int’l Commercial documents 8. Cross Docking, Reverse Logistics

REFERENCE BOOKS: 01. Int’l Logistics – Pierre David 02. Global Logistics _ Fawcet, Crateria & Lopez 03. Logistics Management – Lambert 04. Managing Channels of Distribution – Stern & Ansari

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III - Indian Foreign Trade Policy 01. Exim Policy Objectives 02. Special Focus Initiatives 03. General Provisions reg import & export, Definitions 04. Star Exporters, Export Promotion Councils / RCMC 05. Duty exemption / remission schemes 06. EPCG 07. EOU , EHTP, STP, BTP, SEZ, Free trade & Warehousing Zones 08. Deemed Exports. 09. FTA & Certificates of Origin 10. INCO Terms 11. FEMA: Repatriation & remittances. 12. Customs and central excise duty drawback 13. Custom’s clearance of imported cargo 14. Bonded Warehousing 15. Shipment of Goods, Export Documentation. 16. Export & insurance

Books Recommended : How to Export & How to Import by Nabhi Publications Export Do It Yourself – MI Mahajan Foreign Trade Policy – GOI Publication / Website http://dgft.gov.in

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