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Valuation-EMBA-18
MBA(Exe.) 2018-19: Term-III

2


Valuation

Credits1.5
Faculty Name Banikanta Mishra
Program EMBA
Academic Year and Term 2018-2019

1. Course Description:

Building on the basics of Valuation that you were exposed to in Financial Management, this course would familiarize you more intimately with the building-blocks of valuation. We will learn about different valuation methods and consistency – or lack of - between them as well as about treatment of capital structure under different situations (like constant debt and constant debt-ratio). In this light, we will talk about cost of capital and the interaction between investment and financing decisions. We will also learn about different alternatives to the DCF valuation approach, using comparable indicators. If time permits, we will end the course talking about real options that arise in capital-budgeting problems.


2. Student Learning Outcomes (typically 3-5 bullet points):

ü Be able to understand the complexities of valuing a firm and enterprise
ü Be able to value a project and firm using different valuation approaches
ü Be able to value a firm even when cash-flows are not perpetual
ü Be able to understand the consistencies or lack thereof between various valuation approaches


3. Required Text Books and Reading Material
You may refer to one or more of the following texts depending on the topic: Valuation by Sheridan Titman and John Martin, Corporate Finance: A Valuation Approach by Simon Benninga and Oded Sarig, Corporate Valuation by Bradford Cornell, Valuation: Measuring and Managing the Value of Companies by McKinsey& Company, Tom Copeland, Tim Koller, and Jack Murrin, Valuing a Business by Shannon Pratt, Robert Reilly, and Robert Schweihs, and Financial Markets and Corporate Strategy by Mark Grinblatt and Sheridan Titman. For cases, you would need to refer to Case Problems in Finance by Carl Kester, Richard Ruback, and Peter Tufano (McGraw Hill International Edition, Twelfth Edition).


4. Some Basic Examination Rules:

You would be given either a question-cum-answer paper or a question paper with an attached answer-paper. In the former case, you would be given a specific amount of space following each question for writing your answer. In the latter, you would be given a specific total number of pages to write your answers in; you should use both sides of each sheet and show your answers in ascending order (answer to Q.1 first, followed by answer to Q2, and so on), leaving half-inch gap between your answers. In all cases, leave half-inch margin on both left and right sides. Read instructions, if any, on the question/question-cum-answer book; if an instruction therein conflicts with one given here, then it overrides the one given here. If not specifically asked to use a pen, you may use either pen or pencil. Write legibly; if I cannot read what you have written, I will not give you any points for the relevant portion.

Unless merely asked to tick the right answer, explain clearly all your derivations and answers; if no explanation is given, no credit will be given for merely ticking or jotting down the correct answer. Be precise; clumsy writing and imprecise or unnecessarily lengthy answers will be penalized. You are not allowed to seek any clarifications from anyone (not even your instructor) during examinations; if a question is wrong or unclear, just state why the question is wrong/unclear and, if possible, make an assumption and answer the question. If you are found to be justified doing what you did, you will get full points; or else, you would receive less (even zero).

5. Tentative Session Plan

Session
Topic(s)
1
Basic Valuation Formulae
2-3
Capital Structure and Firm Value (MMs)
4-5
Valuation Approaches: Inconsistency
6-7
Making Valuation Approaches Consistent
8
Valuation Using Comparable Indicators
9
Real Options: Valuation using Decision Tree
10
Cases: Whirlpool Europe and Sampa Video

6. Evaluation:

Your grade would be determined by the following components: midterm exam (35%), final exam (35%), class participation (1% each class x 10 = 10%), and two group-case-reports (10% each x 2 = 20%). Your performance in the course would be determined by your weighted-average-score in percentage (WASP) in the above. Each group should consist of two students; please let me know as soon as you have formed your group. (Detailed instruction on how to write case-reports would be provided later.)

7. Academic Integrity (taken verbatim from the University of Texas, Dallas, format):

The faculty expects from its students a high level of responsibility and academic honesty. Because the value of an academic degree depends upon the absolute integrity of the work done by the student for that degree, it is imperative that a student demonstrate a high standard of individual honor in his or her scholastic work.

Scholastic dishonesty includes, but is not limited to, statements, acts or omissions related to applications for enrollment or the award of a degree, and/or the submission as one’s own work or material that is not one’s own. As a general rule, scholastic dishonesty involves one of the following acts: cheating, plagiarism, collusion and/or falsifying academic records. Students suspected of academic dishonesty are subject to disciplinary proceedings.

Plagiarism, especially from the web, from portions of papers for other classes, and from any other source is unacceptable and will be dealt with under the university’s policy on plagiarism (see general catalog for details). This course will use the resources of turnitin.com, which searches the web for possible plagiarism and is over 90% effective.


8. An Additional Code of Ethics:

You must abide yourself by the (unwritten) Code of Ethics for Students. For individual (group) assignments/examinations/projects, it is unethical to seek any direct help from others (other groups), whether or not you make use of the help. Besides, other forms of dishonesty (like plagiarism) would also invite severe punishment. Moreover, for a group assignment, all members of the group should contribute to the preparation of the report (no free-riders), and no direct help should be sought or taken from persons outside the group. Discussion among individual students and groups (except in the examination hall or class-room) is, of course, always encouraged. But, the final report or solution should be totally in your (your group’s) own style and language; any form of copying from another student (or group) or from any outside source is a serious offense. Moreover, you (or, wherever relevant, each member of your group) must fully and clearly understand every word and every step written in your (your group’s) report. Your basic purpose should be to learn, without resorting to any unfair means for getting a higher score/grade. If you resort to any unfair means, including, but not limited to, the ones mentioned above, you would receive an F in the course; I may also recommend to the Institute for your expulsion.


Created By: Alora Kar on 01/04/2019 at 09:09 AM
Category: MBA(Exe.)2018-19 T-III Doctype: Document

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