Business Mathematics 8 Sept

FINANCIAL ANALYSIS AFTERSCHO☺OL – DEVELOPING CHANGE MAKERS CENTRE FOR SOCIAL ENTREPRENEURSHIP PGPSE PROGRAMME – World’ Most Comprehensive programme in social entrepreneurship & spiritual entrepreneurship OPEN FOR ALL FREE FOR ALL

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

FINANCIAL ANALYSIS Dr. T.K. Jain.

AFTERSCHO☺OL Centre for social entrepreneurship Bikaner M: 9414430763 [email protected] www.afterschool.tk, www.afterschoool.tk www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

WHAT IS ALPHA, BETA, GAMMA, THETA, RHO, VEGA, DELTA ? • All these are terms used with regard to options. • Alpha, Beta, are with regarding to risk. • Gamma is second derivative of option based on share price. • Delta is with regard to Hedge ratio • Theta, Rho, and Vega are derivatives with respect to expiration, interest rate and volatility. www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is full form of PRIDES? • Preferred Redeemable Increased Dividend Equity Securities

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is IRR? • Internal Rate of Return (what is the return that your project will give you. Suppose, you get 20% return from project, then IRR is 20%

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is liquidity? • When there is enough cash / large number of transactions taking place, we call it liquidity .

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is VC? • Venture Capital : This is the money which you get when you start a new business, particularly in high technology, new sectors, having very high growth potential

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

WHAT IS QUIPS? • Qurterly income preferred stock

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is ROA? • Return on Assets

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is DDM? • Dividend Discount Model

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is PPP? • Purchasing Power Parity (it is very useful in international trade, as foreign exchange rates fluctuate due to change in PPP).

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is FASB? • Financial Accounting Standard Board (USA).

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is CAPM? • Capital Asset Pricing Model

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is ADR? • American Depository Recipt

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is cum-divident and exdividend? • Cum dividend means that share price included dividend • Exdividend is after payment of dividend and so the share price does not include it.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is EVA, who gave it ? • Economic Value Added , Stern Steward Management Servidces have given this concept. Suppose, your profit is 25 Lakhs. Your capital employed is 50 Lakhs. Your WACC (weighted Average Cost of Capital) is 20%, your EVA is 25 – (20% of 50) • =25 – 10 = 15 Lakhs. Answer.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is MVA? • Market Value Added. • Suppose capital invested is 50 Lakhs, but market value of company is 120 lakhs, MVA is 70 Lakhs.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is APV? • Adjuested Present Value • This model is given by Steward C. Myres. • It is calculated by adding unlevered value of firm + financing.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is premium? • If the face value of Share is 10, but in market it is selling at 15, there is premium of Rs. 5. • Opposite of premium is discount

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is MIPS? • Monthly income preferred stock

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is CEPS? • Convertible Exchangeable preferrred Stock

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is PERCS? • Preferered equity redemption cumulative stock

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is SWAP • When you can exchange floating rate option to fixed rate option or vice versa, it is called SWAP. • For example, I have to pay fixed interest of 12%, I change it into floating interest rate of 15%, it is called swap. Now floating rate can change to 10% also, but fixed rate will remain same. www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is Credit Derivative? • When we want to protect ourselves for the credit that we have extended, we go for credit derivatives. There are many derivatives, like Credit Swap, credit adjusted notes, credit options etc.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

In which of these will you find maximum protection of your risk? • Future • Forward • Options SOLUTION: • Options

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is PEG ratio? • PE ratio / growth rate is called PEG ratio.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is synergy? • 2+2=5 • Or 1+1 =11 • The power of collectives is called positive synergy.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

What is LBO? • Leveraged Buy outs • Suppose you want to take over Tata Motors, you borrow money for this from market and takeover the company, it is called LBO.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

ABOUT AFTERSCHO☺OL Afterschoool conducts three year integrated PGPSE (after class 12th along with IAS / CA / CS) and 18 month PGPSE (Post Graduate Programme in Social Entrepreneurship) along with preparation for CS / CFP / CFA /CMA / FRM. This course is also available online also. It also conducts workshops on social entrepreneurship in schools and colleges all over India – start social entrepreneurship club in your institution today with the help from afterschoool and help us in developing society.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Why such a programme? • To promote people to take up entrepreneurship and help develop the society • To enable people to take up franchising and other such options to start a business / social development project • To enable people to take up social development as their mission • To enable people to promote spirituality and positive thinking in the world www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Who are our supporters? • Afterschoolians, our past beneficiaries, entrepreneurs and social entrepreneurs are supporting us. • You can also support us – not necessarily by money – but by being promotor of our concept and our ideas.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

About AFTERSCHO☺OL PGPSE – the best programme for developing great entrepreneurs • • • • •

Most flexible, adaptive but rigorous programme Available in distance learning mode Case study focused- latest cases Industry oriented practical curriculum Designed to make you entrepreneurs – not just an employee • Option to take up part time job – so earn while you learn • The only absolutely free course on internet www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Workshops from AFTERSCHO☺OL • • • • • • • • •

IIF, Delhi CIPS, Jaipur ICSI Hyderabad Branch Gyan Vihar, Jaipur Apex Institute of Management, Jaipur Aravali Institute of Management, Jodhpur Xavier Institute of Management, Bhubaneshwar Pacific Institute, Udaipur Engineering College, Hyderabad

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Flexible Specialisations: • • • • • • • • • •

Spiritualising business and society Rural development and transformation HRD and Education, Social Development NGO and voluntary work Investment analysis,microfinance and inclusion Retail sector, BPO, KPO Accounting & Information system (with CA / CS /CMA) Hospital management and Health care Hospitality sector and culture and heritage Other sectors of high growth, high technology and social relevance

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Salient features: • The only programme of its kind (in the whole world) • No publicity and low profile course • For those who want to achieve success in life – not just a degree • Flexible – you may stay for a month and continue the rest of the education by distance mode. / you may attend weekend classes • Scholarships for those from poor economic background • Latest and constantly changing curriculum – keeping pace with the time • Placement for those who are interested • Admissions open throughout the year • Latest and most advanced technologies, books and study material www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Components • • • • • • • • • • • • • •

Pedagogy curriculum and approach based on IIM Ahmedabad and ISB Hyderabad (the founder is alumnus from IIMA & ISB Hyderabad) Meditation, spiritualisation, and self development Essential softwares for business Business plan, Research projects Participation in conferences / seminars Workshops on leadership, team building etc. Written submissions of research projects/articles / papers Interview of entrepreneurs, writing biographies of entrepreneurs Editing of journals / newsletters Consultancy / research projects Assignments, communication skill workshops Participation in conferences and seminars Group discussions, mock interviews, self development diaryng Mind Power Training & writing workshop (by Dr. T.K.Jain)

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Pedagogy • • • • • • • • •

Case analysis, Articles from Harvard Business Review Quiz, seminars, workshops, games, Visits to entrepreneurs and industrial visits Presentations, Latest audio-visuals Group discussions and group projects Periodic self assessment Mentoring and counselling Study exchange programme (with institutions out of India) • Rural development / Social welfare projects www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Branches • AFTERSCHO☺OL will shortly open its branches in important cities in India including Delhi, Kota, Mumbai, Gurgaon and other important cities. Afterschooolians will be responsible for managing and developing these branches – and for promoting social entrepreneurs.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Case Studies • We want to write case studies on social entrepreneurs, first generation entrepreneurs, ethical entrepreneurs. Please help us in this process. Help us to be in touch with entrepreneurs, so that we may develop entrepreneurs.

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

Basic values at AFTERSCHO☺OL • • • • • •

Share to learn more Interact to develop yourself Fear is your worst enemy Make mistakes to learn Study & discuss in a group Criticism is the healthy route to mutual support and help • Ask fundamental questions : why, when, how & where? • Embrace change – and compete with yourself only www.afterschoool.tk

AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS

www.afterschoool.tk social entrepreneurship for better society

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AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS