Corporate Finance: Theory and Practice

Front Cover
SAGE, Mar 6, 2007 - Business & Economics - 761 pages
This—revised and enhanced—book examines the role of finance in supporting other functional areas while fostering an understanding of how financial decisions can create value. Corporate Finance covers areas related to estimating divisional cost of capital; executing a financing strategy; establishing debt and dividend policies consistent with the company`s strategy and environment; choosing between dividends and stock repurchases; managing high growth and managing working capital. Its new topics include:

- Corporate Financial Flexibility (Real options)
- New Financial Instruments
- Project Finance
- Acquisitions and Control
- Performance Measurement and Incentive Compensation

The goal of this book is to provide a thorough understanding of how and why firms make their financial decisions the way they do and their impact on shareholder value. The central theme of the book is Value Based Management, which assumes that maximizing shareholder value is the governing objective of a firm.

Each chapter of this new edition has detailed and real-life cases to help students easily understand and grasp concepts. The author has also provided the case-map of the Harvard Business School to make this book more user-friendly in classrooms.

The inclusion of several new topics/cases, extensive pedagogical tools and a finance-for-non-finance approach make this book ideal for MBA/CA/CFA/ICWA students and executive education programs.
 

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Contents

List of Exhibits
15
i
23
1a Future value interest factor
43
1
69
1
89
2
114
4
137
1
153
142
467
Debt Markets
468
145
473
Rating agencies in Asia
481
A Followup Note on Financing
490
Credit rating symbols
494
Exchange rates inflation rates and interest rates
510
163
525

Overview of Capital Budgeting
163
Free Cash Flow Valuation
179
10
201
5
213
Section Three MANAGING CURRENT ASSETS
267
Estimation of Working Capital
269
6
276
Bharti Dredging and Construction Limited
296
Cash Management
305
Receivables Management
322
SM Electric India Limited
341
8
342
Section Four THE FINANCING DECISION
351
Optimal Capital Structure
353
An Overview of Financing Choices
376
Initial Public Offerings
396
10
404
1
425
Bank Loans
432
23
461
Financing NTPC
527
Project Financing
546
HPL Cogeneration Limited
563
The Leasing Decision
576
Section Five DIVIDEND POLICY
593
The Dividend Debate
595
Back to SM Electric India Limited
622
179
644
Section six FINANCIAL POLICY COMPETITIVE STRATEGY AND SHAREHOLDER VALUE
647
Growth and Value
649
Growth via Mergers and Acquisitions
663
The Merger of ICICI Bank and Bank of Madura
687
201
692
468
694
Leveraged Recaps and Buyouts
702
EVA and Divisional Performance Measurement
721
Index
743
209
745
About the Author 763
Copyright

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About the author (2007)

Vishwanath S. R. is a Professor of Finance, MBA Programme Chair and Faculty Director of Executive Education in the School of Management and Entrepreneurship at Shiv Nadar University. He is the author of two volumes of 80 case studies published by McGraw Hill (India) and four books published by Springer Verlag, SAGE and PHI Learning (formerly Prentice Hall of India), and several cases published by the Asian Case Research Journal, The CASE Journal and Harvard Business Publishing.

He has held academic appointments at the S. P. Jain Institute of Management in Mumbai, Emirates Institute for Banking and Financial Studies in Sharjah, T. A. Pai Management Institute in Manipal, Bharathidasan Institute of Management in Trichy, Tata Management Training Centre in Pune and Institute of Management Technology in Nagpur. He has two decades of experience in teaching graduate students and executives from a variety of industries.

Vishwanath S. R. was the Regional Editor of Emerald Emerging Markets Case Studies, UK, during 2012–2014. He received the Ruth Greene Memorial Award, the Best Workshop Case Award and Jonathan Welch Case Award from North American Case Research Association (NACRA) in 2010, 2012 and 2014, respectively. He was nominated for the CMA of Alberta Governance Award at NACRA in 2013 and Excellence in Case Writing Award in 2014 by the Case Association of the United States. He received the Hindustan Unilever Dewang Mehta Best Professor in Finance award in 2013.

His research papers examine the role of certification and anchor investors in initial public offerings (IPOs), performance of family firms, valuation effects of changes in dividend taxes, IPO price stabilization through call auctions, the impact of stock market reforms on capital allocation to IPO firms and economic growth, risk-taking in family firms, the value of executive directors, the impact of ownership of IPOs on liquidity and stock returns and offshore dollar-denominated convertibles issued by Indian firms. He has presented his research at major global conferences such as American Economic Association/ASSA meetings, Journal of Corporate Finance Special Emerging Markets Conference, Asian Finance Association meetings, EFMA meetings, Financial Markets and Corporate Governance Conference and North American Case Research Association meetings.

He has been enlisted in the Marquis Who’s Who in the World and Madison’s Who’s Who among executives and professionals throughout the world.

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