JAIPURIA INSTITUTE OF MANAGEMENT

PGDM; TRIMESTER II; BATCH 2021-23

Course Code and title XXXXX: Corporate Finance

Credits 3

Term and Academic Year II Term, 2021 -22

Course Pre-requisite(s) Accounting for Business

Course Requirement(s) Knowledge of spreadsheet applications

and Basics of Statistics

Course Schedule (day and time of class)

Classroom # (Location)

Course Instructor

Email

Telephone Number (for office

appointments)

Student Consultation Hours

Office location

1. Course Overview
The introductory course of Corporate Finance has been designed for the business management
students to provide them an overview of the financial environment in which a firm operates and
is concerned with creation and maintenance of wealth in a rational way. Financial Management
is a managerial activity which calls for planning and controlling of the firm’s financial resources.
In its endeavour, it focuses on the decision making. Almost all decisions taken by an individual
or a business firm have financial aspects and implications. Financial management is the study of

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decisions that have financial implications and mainly comprise of investing, financing and
dividend decisions.

The course has been divided into six different module which would take students from
understanding the role of financial manager of a firm in achieving the goal of the firm. Students
will learn how finance manager measures risk and return associated with any business activity
and takes the investment decision if compensation for taking risk is optimal. Students will also
learn how finance manager decides upon the optimal capital structure, profit distribution and
working capital management. Further a good knowledge of the Corporate Finance will help
the students to develop their understanding in the other domains like Marketing, Operations
and Human Resource Development as all planning and execution and performance
measurement finally take shapes in the form of financial figures. Return on investment reign
supreme in any business/ economic environment
2. Course Learning Outcomes

On successful completion of the course you should be able to:

CLO1: Apply financial tools for decision making

CLO2: Analyze the long-term financial decisions of a business firm
CLO3: Analyze the short-term financial decisions of a business firm

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Mapping of CG-CLO

CG1 CG2 CG3 CG4 CG5

Communicate Demonstrate Apply Evaluate Awareness

Effectively the Ability to relevant different of impact of
Work in Teams conceptual ethical business
to Achieve frameworks perspectives decisions on
Desired Goals to a given issues of
business social
situation concern

CLO 1 X(R)

CLO 2 X(I) X(R)

CLO 3 X(I)

Mapping of CG-CLO- Direct Assessment Tools

CG – 3 Level Direct Assessment

Tool
1: Overview of Corporate Finance and Risk-Return Introduce Quizzes
2: Time Value of Money (TVM) Emphasise Quizzes/Build Your
CLO 1 Model Exercise/ Group
assignment
3: Long-term Investment Decisions Emphasise Group Assignment
CLO 2
4. Cost of Capital and Long-term Financing Emphasise Quizzes/ Group –
CLO 2 Individual assignment
Decisions

5. Dividend Decisions Emphasise Quizzes/ Hall

CLO 2 Examination

6. Working Capital Management Introduce Quizzes/ Hall

CLO 3 Examination

3. Course Modules

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Overview of Corporate Finance and Risk-
Return
Time Value of Money (TVM)
Long-term Investment Decisions
Cost of Capital and Long-term Financing
Decisions
Dividend Decisions
Working Capital Management
4. Text Book
 Corporate Finance and Role of Financial
Manager
 Goal of a Firm, Agency Issue, Ethics in
Business
 Risk and return relationship
 Measures of Risk
 Risk diversification through portfolio
formation
 Systematic Risk vs. Unsystematic risk
 Beta concept, CAPM Model
 Concept and importance of TVM
 Present Value (PV) calculation
 Future Value (FV) calculation
 Annuities
 Perpetuities
 Mixed streams
 Overview of Capital Budgeting
 Pay-Back Period, NPV, IRR. MIRR
 Project evaluation
 Estimating cost of various sources of capital
 WACC
 Capital structure and value of firm
 Optimal capital structure
 Benefits and costs of using debt
 Types of Dividends
 Dividend Policy Issues, information
content/signaling
 Clientele effect
 Establishing dividend policy
 Stock dividends & stocks splits, stock
repurchase
 Current assets investment policies
 Current assets financing policies
 Cash conversion cycle
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Parrino, R., & Kidwell, D. (2017). Fundamentals of Corporate Finance. New Delhi: Wiley India
Edition.
Suggested reference books:
 Brealey, R. A., Myers, S. C., Allen, F., 13th Edition (2020). Principles of Corporate
Finance. New Delhi: Tata McGraw- Hill.
 Brigham, E. F., & Houston, J. F. (2004). Fundamental of Financial Management (16th
Edition ed.). New Delhi: South Western -Cengage Learning India Private Limited.
 Megginson, W. L., Smart, S. B., & Gitman, L. J. (2007). Principles of Corporate
Finance. New Delhi: Cengage Learning India Private Limited.
 Damodaran, A.(2004).Corporate Finance - Theory and Practice (Second Edition) New
Delhi:Wiley India (P) Ltd.
 Bodhanwala, R. J. (2009). Financial Management Using Excel Spreadsheet. New Delhi:
Taxmann Publication.

5. Assessment Tasks
Assessment Item Description Weightage CLO
Quiz There shall be 6 Quizzes, 20 % CLO1, CLO2,
one from each module. CLO3

These quizzes shall be

timed immediately after the
completion of respective
modules.
(Quiz 1- after 4th Session)
(Quiz 2 -after 7th Session)
(Quiz 3-after 10th Session)
(Quiz 4-after 15th Session)
(Quiz 5 -after17th Session)
(Quiz 6 -after19th Session)

Each Quiz shall comprise of

at least 15 MCQs. These will
be administered on LMS.
Minimum 30-questions’
Question bank will be
prepared and used for this
purpose.

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 Instructor may conduct
additional quizzes as a part of
formative assessment from
time to time.
Build your model Each student will be 10% CLO1
Exercise required to build an excel
model depicting the
application of time value of
money concepts.
Group Project This should be a 25% CLO2
comprehensive project and
shall have an elements of
Investing, Financing and
Dividend decisions, thus
covering the substantial
portion of the Corporate
Finance course.

Ideally group project for

each set of students (i.e.
Project Group) shall be
different to bring more
diversity, shall involve
varying business situations,
specific to given
industries/sector/ economy.

Class Performance Essentially formative 5% CLO1, CLO2,

assessment, shall capture the CLO3
students’ performance in class
activities on a regular basis;
Students’ preparedness for
each class; Ideas and relevant
& new things one adds to the
class room discussion
(essentials and desirable
components under VED
analysis) shall be considered.
Suggested important markers:
 Frequency of
participation
 Quality of deliberation
& comments
 Listening skills
End-Term Question paper will assess 40% CLO2, CLO3

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 Examination the student’s ability to
analyse the long term
investing and financing
decisions of a firm.

Suggested Innovative Assessment Tools

1. Video Quiz ( https://forms.gle/T7jfjSUdhmicQApj9)

2. Crossword Puzzle
(https://drive.google.com/file/d/1TgDzyrXYMQzYWLHIDwXqnz8wZbywPmyk/view?
usp=sharing )
3. Excel Base Assignments ( https://drive.google.com/file/d/1POa7qknOlCvGLrPLp7z-
_heCOsCSw7Rz/view?usp=sharing )
4. Movie Review
a. Assignment Text (https://drive.google.com/file/d/11skEQGK_0WLmiSzpCuzOr51XUssEcseK/
view?usp=sharing )
b. Video Review (https://drive.google.com/file/d/12rp2EF8Bxl3LmPYLtTTaQZwyhJVQP0pZ/
view?usp=sharing )
5. End Term Examination on Goole Forms ( https://forms.gle/sognR7LVxUiGdSwU8 )

RUBRICS FOR ASSESSMENT COMPONENTS

RUBRICS FOR END TERM (40 Marks) (CLO2 & CLO3)

Traits Below Meets Exceeds
Expectations Expectations Expectation
Marks ( 0-12) Marks (13-24) Marks (25-40)
Select and Use Relevant Concepts and Has limited Selects and uses Selects and uses
Frameworks knowledge on relevant concepts relevant concepts
selecting and and frameworks. and frameworks.
 Demonstration of analytical skills & using relevant Requires minimal Needs no
logical reasoning based on concept, concepts and assistance in assistance in
theories, practices, regulatory frameworks. choosing relevant selecting relevant
framework Requires concepts and concepts and

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 extensive frameworks. frameworks.
understanding
about selecting
relevant concepts
and
frameworks.

RUBRICS FOR PROJECT ASSIGNMENT (20 Marks) (CLO2 & CLO3)

Traits Below Meets Exceeds
Expectations Expectations Expectation
Marks ( 0-6) Marks (7-12) Marks (13-20)
Gather Relevant Information:
(Weightage -30%) Struggles to Clearly identifies Demonstrates a
 About the Organisation under study viz. pinpoint the the information sophisticated
Firm/ companies/industry from reliable information required. understanding of
sources needed. what information
 Assuring evidence of search /selection / Gathers information is needed.
collection of data, correctness and Gathers from multiple valid
completeness of data and information information from and reliable Gathers extensive
 Presentation of the gathered one source. sources. information from a
information in proper format & Style variety of valid and
Minimal evidence Evidence of reliable sources
of appropriate appropriate including journals,
search/selection search/selection texts, etc., specific
criteria. criteria. to the subject.

Unable to reflect Able to reflect and Clear evidence of

and comprehend understand the appropriate
the business business situation search/selection
situation due to because of the criteria.
poor understanding quality of
of required information Able to reflect and
information. gathered and have a holistic view
synthesized. of the business
situation based on
extensive
information
gathered from a
variety of sources
Select and Use Relevant Concepts and Has limited Selects and uses Selects and uses
Frameworks knowledge on relevant concepts relevant concepts
(Weightage -70%) selecting and and frameworks. and frameworks.
using relevant Requires minimal Needs no
 Demonstration of analytical skills & concepts and assistance in assistance in
logical reasoning based on concept, frameworks. choosing relevant selecting relevant
theories, practices, regulatory Requires concepts and concepts and
framework extensive frameworks. frameworks.
assistance in
selecting relevant
concepts and
frameworks.

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RUBRICS TO ASSESS THE GROUP PERFORMANCE OF STUDENTS DEMONSTRATING THE ABILITY
TO WORK AS TEAM(as an allied component of group project) (5M)(CLO 2 component mapped with PLO2/CG2)

Criterion Below Expectations Meets Expectations Exceeds Expectation

Marks ( 0-1) Marks (2 -3) Marks (4-5 )
Working with Rarely listens to, shares Usually listens to, shares, Almost always listens to, shares
others with, and supports the with, and supports the with, and supports the efforts of
efforts of others. efforts of others. others.

Often is not a good team Tries to keep people working well

player together.
Contribution Rarely provides useful Usually provides useful Routinely provides useful ideas
ideas when participating ideas when participating in a when participating in a group
in a group task. group task. task.

May refuse to participate A strong group member who A leader who contributes a lot of
tries hard effort
Attitude Is often publicly critical Is rarely publicly critical of Is never publicly critical of the
of the project or the work the project or the work of project or the work of others.
of other members of the others.
group. Always has a positive attitude
Often has a positive attitude about the task(s)
Is often negative about about the task(s)
the task(s)

RUBRICS FOR CASE ANALYSIS/ BUILD YOUR MODEL EXERCISE (10 Marks) (CLO1)
Traits Below Expectations Meets Expectations Exceeds
Expectation
Marks ( 0-6) Marks (7-12) Marks (13-20)
Comprehensiveness of Articulates few/none Articulates the assumptions Clearly and fairly
Case Analysis/ Build assumptions used in used in interpreting the articulates the
Your Model Exercise interpreting the information in information but not in a clear assumptions used in
(50%)
ambiguous manner. manner. interpreting the
information.
Interpretation of data, reports, Expresses valid
facts, assertions, etc., is interpretations of data, Reasonable and valid
unclear and incomplete. reports, facts, assertions, etc., interpretations of data,
in an unclear fashion reports, facts, assertions,
Articulates the inferences that etc.
partially follow from the Articulates the inferences that
evidences presented in an follow from the evidences Clearly articulates the

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 unclear fashion presented in an unclear inferences that follow
fashion. from the case.
Explains few/none key
concepts and their Explains key concepts and High level of accuracy
application in the case their application in the in expressing key
case but not in a precise concepts and their
manner. application in the case.
Select and Use Has limited knowledge on Selects and uses relevant Selects and uses
Relevant Concepts selecting and using relevant concepts and frameworks. relevant concepts and
and Frameworks concepts and frameworks. Requires minimal frameworks. Needs no
(50%) Requires extensive assistance in choosing assistance in selecting
 Demonstration of understanding about relevant concepts and relevant concepts and
analytical skills & selecting relevant concepts frameworks. frameworks.
logical reasoning and
frameworks.
based on concept,
theories, practices,
regulatory
framework

RUBRIC FOR QUIZZES (20 Marks) (CLO-1,2,3)

TRAITS POOR FAIR GOOD EXCELLENT

Marks 0-6 Marks 7-10 Marks 11-16 Marks 17 – 20

Marks scored in the MCQ based Only up to 30% Between 31% – Between 51% More than 80%
Quizzes answers are correct 50% (both – 80% (both answers are correct
(with application of Excel inclusive) inclusive)
spreadsheets) answers are answers are
correct correct
Testing Numerical solving ability, A very few of the Some of the Majority of Most of concepts
along with application of concepts are clear concepts are clear concepts are are clear and
concepts, theories, postulates and student is and understood clear and understood by the
unable to by student. understood by student.
understand the student.
same.

6. Session Plan

Sess Topic/ Sub Topic Reading Pedagogy Session Learning CLO

ion Reference Outcomes

Module I: Overview of Corporate Finance and Risk-Return

1. Introduction to Chapter 1 Class At the end of the -

Corporate Finance, discussion session, the student
Role of Financial will be able to
Manager, Goal of describe the basics
firm, Agency of corporate

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 conflicts, Importance Warm up finance, primary
of ethics in business news goal of firm, agency
story/video issues and relevance
of ethics in business

2. Concept of risk and Chapter 7 Class At the end of the CLO1

return, relationship discussion, session, the student
between them, Numerical will be able to
Measurement of risk exercises measure the risk and
and return return in standalone
context.

3. Risk and Chapter 7 Class At the end of the CLO1

diversification, Discussion session, the student
Systematic risk and will be able to explain
unsystematic risk Numerical how and why
exercises diversified portfolio
reduces risk.

4. Beta and CAPM Chapter 7 Class At the end of the CLO1

discussion session, the student
will be able to
Spreadsheet measure systematic
exercises risk and explain the
concept of CAPM
and limitations of
CAPM

Module II: Time Value of Money

5. Introduction to TVM, Chapter 5 Class At the end of the CLO1

Time lines, discussion session, the student
Compounding and will be able to
discounting Spreadsheet compute PV and FV
exercises in various situations

6. FV and PV of multiple Class At the end of the CLO1

cash flows, Annuities, Chapter 6 discussion session, the student
Perpetuities. will be able to
Spreadsheet estimate PV of
exercises perpetual stream of
cash flows and PV
and FV of annuities

7. Practice Session – Case lets Spreadsheet At the end of the CLO1

application of TVM exercises session, the student

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 in financial planning will be able to apply
situations the concepts
learned in TVM to
real life finance
problems
Module III: Long-term Investment Decisions

8. Introduction to capital Chapter 10 Class At the end of the CLO2

budgeting Discussion session, the student
Case study will be able to
explain the
relevance of capital
budgeting decisions
for a firm

9. Capital budgeting Chapter 10 Class At the end of the CLO2

techniques, NPV, PP, Discussion session, the student
IRR, MIRR will be able to
estimate the amount
of depreciation and
Numerical value of fixed asset
exercises

10. Practice session Case study Peer learning At the end of the CLO2
activity session, the student
will be able to apply
the concepts of
capital budgeting

Module IV: Cost of Capital and Long-term Financing Decisions

11. Firm’s overall cost of Chapter 13 Class At the end of the CLO2
capital discussion session, the student
Case Study will be able to
explain the concept
of cost of capital

12. Estimating cost of Chapter 13 Class At the end of session, CLO2

debt, cost of equity the student will be

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 and WACC Case Study discussion able to compute cost
of debt, cost of equity
Case study and WACC
related
calculations

13.Capital structure and Chapter 16 Class At the end of the CLO2

firm value discussion session, the student
will be able to explain
how capital structure
may influence firm
value

14.Optimal Capital Chapter 16 Spreadsheet At the end of the CLO2

Structure exercise session, the student
will be able compute
WACC and firm
value for various
levels of debt-equity
ratio

15.Theories of capital Chapter 16 Class At the end of the CLO2

structure, trade-off discussion session, the student
theory, pecking order will be able to
theory
explain the
concepts of capital
structure theories

Module V: Dividend Decisions

16.Dividends Chapter 17 Class At the end of the CLO2

fundamentals, types of discussion session, the student
dividends, signalling will be able to
theory of dividends, explain the various
Stock repurchases types of dividends

17.Stock dividends and Chapter 17 Class At the end of the CLO2

stock splits, dividend Discussions session, the student
policy and firm value will be able to
explain the factors
influencing
dividend policy of a
firm

Module VI: Working Capital Management

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18. Working capital Chapter 14 Class At the end of the CLO3
basics, operating and discussion session, the student
cash conversion Numerical will be able to
cycles exercises calculate operating
and cash conversion
cycle of a firm

19.Working capital Chapter 14 Class At the end of the CLO3

investment and discussion session, the student
financing strategies, will be able to
Sources of short-term understand the
financing liquidity-profitability
trade-off involved in
working capital
management
strategies

20.Summing up Class At the end of the

Discussion session, the student
will be able to
explain all the
concepts learned in
the course in a
comprehensive
manner

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