GDGU/FRM/1.
1/ACAD/003
FIN 8702 Corporate Analysis and Valuation
1. Department/ School: School of Management (SoM)
2. Course Name: Wealth Management 3. Course Code 4. L -T- P 5. Credits
FIN 8702 L-T- P 3
3 -0- 0
✔
Programme Core Programme Elective Open Elective
6. Type of Course (Tick
one):
VAC
7. Prerequisite(s), if any (Mention course code and name)
FIN 7702 – FINANCIAL MANAGEMENT
✔
8. Frequency of offering (check one): Odd Even Any Semester Both Semester
✔
9. Focus: Employability Entrepreneurship Skill Development Basic Knowledge
10. Student-centric methods used for Experiential learning
enhancing learning experiences (Tick relevant)
✔
Participative Learning
Problem-solving methodologies
✔
11. Brief Syllabus:
UNIT I Acquisitions and Takeovers
UNIT II Corporate Strategies and Tactics
UNIT III Valuation Methods
UNIT IV Funding and Synergy
Total lecture, Tutorial and Practical Hours for this course (Take 15 teaching weeks per semester)
Lectures: 45 Tutorials: 0 Practical’s: 0
12. Course Outcomes (COs)
Possible usefulness of this course after its completion i.e., how this course will be practically useful
to the students once it is completed
COFIN8702.1 Deep – dive into various forms of corporate restructuring
COFIN8702.2 Analyze the strategic rationale for and against an M&A transaction
COFIN8702.3 Value a firm using various valuation techniques such as valuation multiples,
discounted cash flow model, and discounted abnormal earnings model
COFIN8702.4 Explain how to capture value through M&A and create synergies
13. UNIT WISE DETAILS No. of Units: __4__
Unit Number: 1 No. of Lectures: 12 Title: Acquisitions and Takeovers
Content Summary:
Background on Acquisitions, Historical perspective of mergers- waves of merger
Why do companies resort to M&A
Sources of value in M&A
Major forms of M&A – Mergers, Acquisitions, Consolidation
Downsizing of the organization: Sell-off and Divestures- spin-off, split off, split up, Equity carve-outs
explanation and rationale, voluntary liquidations, analysis and valuation of Sell off, Govt. divestment plan
for PSUs.
Unit Number: 2 No. of Lectures: 10 Title: Corporate Strategies and Tactics
Content Summary:
Growth opportunities and M&A
Ansoff’s product matrix
BCG Matrix
Grand Strategy Matrix
Product Life cycle and strategy
Takeover & Defense Tactics
Unit Number: 3 No. of Lectures: 15 Title: Valuation Methods
Content Summary:
The philosophical basis for valuation, Approaches to valuation
Key financial and commercial factors affecting the business.
Discounted cash flow valuation: cash flow to the firms, expected growth, discount rate, asset life, terminal
value.
Residual Earnings Model
Abnormal Earnings Growth Model
Comparable valuation or relative valuation: defining a peer group, picking the right multiples, standardized
values and multiples, determinants of multiples, and use of comparable firms.
Asset-based valuation method.
Unit Number: 4 No. of Lectures: 8 Title: Funding and Synergy
Content Summary:
Provisions of Companies Act 2013 and SEBI regulations on funding for acquisitions
Funding of Acquisitions - LBOs; payment of consideration
Evaluation of post-merger success/failure, testing of synergies achieved
14. Instructions for students
a) Before coming to the class please read latest news on Mergers and Acquisitions
b) All students must secure at least 40% marks in each evaluation component
c) All students must maintain attendance at least 75%
d) All students must submit a project either in group or single
15. Multi-Disciplinary Approach
(Please mentioned whether this course is multidisciplinary or not)
Yes ✔ No
Describe (if yes): Finance, Economics, Strategic Management
16. SDG Number SDG level of correlation
(Mention SDGs number out of 17 SDGs for which this (Mention the level of correlation for each SDG)
course is mapping)
a) SDG……4……… ✔
1. Weak 2. Moderate 3. High
b) SDG……
1. Weak 2. Moderate 3. High
13. Title of Lab Manual (if applicable): NA
14. Books Recommended:
Text Books:
T1. Godbole, P.G. (2013). Mergers, Acquisitions and Corporate Restructuring, 2 nd Edition; Vikas
Publishing House Pvt Ltd., NOIDA, India
T2. Stephen, H. Penman. (2013). Financial Statement Analysis and Security Valuation, 3 rd Edition,
McGraw Hill Education (India)
Reference Books
R1. Damodaran, A. (2001). Corporate finance: Theory and Practice, 2 nd Edition; John Wiley
R2. Kapil, S. & Kapil, N.K. (2018). Mergers and Acquisitions: Strategy, Valuation, Leveraged
Buyouts and Financing, Wiley
E-Book: NA
Reference websites: https://www.rbi.org.in/, https://www.sebi.gov.in/
14. E-Learning Resources
NPTEL:
Animated Lab Videos:
https://www.youtube.com/watch?v=S7DoKFPOhZk
MOOC Supplemented:
https://www.udemy.com/course/introduction-to-corporate-finance/
https://www.udemy.com/course/build-a-dcf-model/
Participative Learning Component
Sr. No. Topic Submissions/Assessment COs covered
1. Discussions through case studies Exams (MSE & ETE) CO1, CO2,
CO3, CO4
Assignment
2. Numerical solving on valuation methods Exams (MSE & ETE) CO3
Assignment
3. Problem discussion on the process for Exams (MSE & ETE) CO1, CO2
valuation of mergers and acquisitions and CO4
and buyouts Assignment
4. Valuation of a real company and finding Exams (ETE) CO3
the value of its shares
Assignment
Activities for Differential Learning Needs
Sr. No. Learning Level Activities Assessment
1. Slow learners Extra classes, assignments, one to Assignment, MSE,
one interaction, guest lectures Test
2. Intermediate learners Skill training, Journal club activities, Test, feedback, viva
guest lectures
3. Advanced Learners VAC courses, skill training Presentation, viva,
feedback
Practical Content
Sr. No. Title of the Experiment Software/Hardware Unit Time Required
based covered
1. NA NA NA NA
Value Added Experiments: NA
Project (To be done as a group of 3 members):
You, a team (group of 3 students) of equity analysts, are working for the equity research division of a
large financial institution. Your task is to prepare a report on the financial valuation of ONE company.
After analyzing the company using concepts and techniques learned in this course, your group will
make recommendations on whether your clients should invest in the company’s shares.
Evaluation Scheme (Choose one)
S. TYPE OF PARTICULAR ALLOTTED PASS CRITERIA
No. COURSE RANGE OF
MARKS
1 Theory Mid-semester examination 20 Must Secure 40%
Marks Out of total
(L-T-0)
End Semester examination 60 Marks
(3-0-0)
Continuous Evaluation Through Class 20
Tests/Practice/Assignments/Presentati
ons/Quiz
RUBRIC FOR EVALUATION:
Criteria Developing Level Competent Level Exemplary Level
(1 mark) (2 marks) (3 marks)
Assignment Some of the relevant Most of the relevant All relevant concepts
concepts applied. concepts are applied. applied. Excellent
A conclusion was Cogent and intelligent concluding section
attempted but some conclusion. drawing together the
points missing. various points made.
Internal evaluation 40-60% 60-80% >80%
(MSE + class
assignment)
External Evaluation 40-60% 60-80% >80%
(ETE)
Mapping of PO’s and CO’s
Cooperation/Teamwork
Disciplinary Knowledge
Research-related Skills
Awareness/Reasoning
Self-directed Learning
Communication Skills
Analytical Reasoning
Readiness/Qualities
Information/Digital
Problem-Solving
Critical Thinking
Moral & Ethical
Competence
Multicultural
Leadership
Literacy
Course Outcome PO1 PO2 PO3 PO4 PO5 PO6 PO7 PO8 PO9 PO10 PO11 PO12
COFIN8702.1
3 2
COFIN8702.2 2 3 2
COFIN8702.3 2 3 3 3 3
COFIN8702.4 2
3 2 2 3 2
1.25 0 2 1.25 1.25 0 0.75 0 2 0 1 0.5
Average
1=weakly mapped 2= moderately mapped 3=strongly mapped
COURSE PLAN (LECTURE/TUTORIAL/PRACTICAL)
S. No. Lecture/ Topics / Sub- Topics Course Pre-Reading
(Learning)
Tutorial Outcomes
(L/T)
1. L Introduction to the course C0FIN8702.1 NA
L Major M&A deals of the C0FIN8702.1 News articles
2. previous year
L Meaning and Reasons for C0FIN8702.1 Godbole Ch.1
3. corporate restructuring
L Activities under corporate C0FIN8702.1 NA
4. restructuring
L Major forms of corporate C0FIN8702.1 Godbole Ch.2
5. restructuring – Merger,
Consolidation
6. L Acquisition control C0FIN8702.1 NA
L Successful/partially C0FIN8702.1 NA
7. unsuccessful
L Partially C0FIN8702.1 NA
8. unsuccessful/unsuccessful
acquisition
L Divestiture, Demerger, Carve- C0FIN8702.1 NA
9. outs
L Divestiture, Demerger, Carve- C0FIN8702.1 NA
10. outs
11. L Reduction of Capital, Delisting C0FIN8702.1 NA
12. L Case discussion C0FIN8702.1 Case handout
L Growth opportunities and M&A C0FIN8702.2 Godbole Ch.3 &
13. 4
14. L Ansoff’s product market matrix C0FIN8702.2 NA
15. L Ansoff’s product market matrix C0FIN8702.2 NA
16. L Ansoff’s product market matrix C0FIN8702.2 NA
17. L BCG Matrix C0FIN8702.2 NA
18. L BCG Matrix C0FIN8702.2 NA
19. L BCG Matrix C0FIN8702.2 NA
20. L Grand Strategy Matrix C0FIN8702.2 NA
21. L Product Life Cycle and Strategy C0FIN8702.2 NA
22. L Case discussion C0FIN8702.2 Case handout
L Introduction to valuation C0FIN8702.3 Damodaran
23. Ch.24
24. L Myths about valuation C0FIN8702.3 NA
L Approaches to Valuation – C0FIN8702.3 Damodaran
25. merits, and demerits Ch.25
L Approaches to Valuation – C0FIN8702.3 NA
26. merits, and demerits
27. L Discounted Cash Flow method C0FIN8702.3 NA
28. L DCF model of valuation C0FIN8702.3 NA
29. L Equity valuation C0FIN8702.3 NA
30. L Firm Valuation C0FIN8702.3 NA
31. L Numerical on DCF method C0FIN8702.3 NA
32. L Numerical on DCF method C0FIN8702.3 NA
33. L Relative Valuation method C0FIN8702.3 NA
L Numerical on Relative C0FIN8702.3 NA
34. Valuation method
L Numerical on Relative C0FIN8702.3 NA
35. Valuation method
L Which approach to use? C0FIN8702.3 Damodaran
36. Ch.26
37. L Funding of Acquisitions C0FIN8702.4 Godbole Ch.15
38. L Companies Act & SEBI C0FIN8702.4 NA
39. L Leveraged buy-outs C0FIN8702.4 NA
40. L Management buy-outs C0FIN8702.4 NA
41. L Payment of consideration C0FIN8702.4 NA
T Numerical on share swap C0FIN8702.4 NA
42. method
43. L Synergy – Case discussion C0FIN8702.4 Case handout
44. L Revision
45. L Revision
