Module 1&2

Module 1&2:

#1 Able to build cash flow based valuation models using excel spreadsheets.

#2 Able to build relative valuation models using excel spreadsheets. (15 hours)

1. Review of Financial Statements.
2. Introduction to equity valuation: application and processes
3. Selecting the appropriate valuation model.
4. Equity risk premium
5. Required rate of return, WACC.
6. Introduction to Industry and Company Analysis: Classifications, peer group
7. Industry and Company Analysis: Porters Five Forces.
8. Forecasting Income Statements: Revenue.
9. Forecasting Income Statements: Earnings and other items.
10. Forecasting Balance Sheet.
11. Forecasting Cash Flow Statement.
12. DDM.
13. Free Cash Flow concept and calculations.

Module 3& 4

Module 3& 4:

#3 Define a logical and coherent investment strategy, based on an appraisal of the range of valuations and risks associated with the stock, in the context of current market conditions.

#4 Write a clear, concise and well-structured report, presenting the argument as to the intrinsic value of the stock and the investment advice relevant to that stock (15 hours)

1. 1. Equity Valuation and Firm Valuation Models: FCFE
   2. Equity Valuation and Firm Valuation Models: FCFF
   3. Relative Valuation Models: Method of Comparable.
   4. Communicating Valuation Results.

Course Description

This course provides an appreciation of the fundamentals and techniques needed to build financial models for valuing companies. The valuation methods explored in this course can be applied by different types of investors, in different market environments, and for different types of transactions. No single valuation technique suits all investors in all types of transactions, and this course adequately recognized that fact. The course will be conducted through lectures and video presentations.

Course Outcomes& Learning levels

After completing this course, students should be able to:

1. Build cash flow based valuation models using excel spreadsheets.
2. Build relative valuation models using excel spreadsheets.
3. Define a logical and coherent investment strategy, based on an appraisal of the range of valuations and risks associated with the stock, in the context of current market conditions.
4. Write a clear, concise and well-structured report, presenting the argument as to the intrinsic value of the stock and the investment advice relevant to that stock.

Evaluation Pattern

*Based on assignments / Tests / Quizzes / Case Studies / Projects / Term paper / Field visit report.

Recommended Texts & Reference Books/ Materials:

Text Book:

1. Corporate Valuation: A guide for Analysis, Managers, and Investors, McGraw Hill

Reference Book:

1. Equity Asset Valuation, 3rd edition, 2015, Jerald E. Pinto, Elaine Henry, Thomas R Robinson, John D Stowe, Wiley Damodaran on Valuation, 2nd Edition, 2006, John Wiley & Sons.