NMIMS Sem 4 April 2025 Finance Assignments
Business: Ethics, Governance & Risk
Q1. “Business should conduct and govern themselves with integrity, and in a manner that is ethical, transparent and accountable” (Principle 1). Prepare an executive summary (in your own words) based on the disclosures given under Essential Indicators and Leadership Indicators, to showcase how the company is delivering on this principle from the Business Responsibility & Sustainability Report – 2023-24 (BRSR) of a company of your choice. You will find this report under Director’s Report section. Please select any ONE company that is listed as Large Cap. For this selection you must refer to the NSE’s Nifty 50 list by market cap. It is required that you include the name of the company in the brief introduction at the beginning. You must also go through the website of the company as well as its sustainability report, if available in public domain for relevant information on Principle 1. DO NOT copy paste.
Q2. Go through the ‘Management Discussion & Analysis’ section under the Director’s Report in the annual report (FY2023-24) of the company selected in question1 and prepare an executive summary (in your own words) on the following two topics:
Opportunities and threat
Internal control systems & their adequacy
You must mention the name of the company. DO NOT copy paste.
Q3. As Head of Sales in a medium size consumer durables company selling cooling systems and air conditioners you have just bagged a Rs 75 lac worth of order from an out-of-town company, (their first order with you). The purchase executive of the client company agrees to confirm the order on the condition that you will agree to pay for his and his wife’s travel and stay in your city, while visiting your office for finalizing and signing of the contract.
3a. What do you think are the ethical dilemmas involved in this scenario?
3b. Describe the process you will adopt to resolve the dilemmas in this scenario?
Research Methodology
Q1. Samsung mobile phones have been facing a significant decline in market share over the past one year in India, despite the growing overall demand for Mobile Phones. The company’s sales have decreased by 12%, while competitors have seen a growth of 18% in the same period. This decline is affecting the company’s profitability and brand position in the market. This decline is occurring despite an overall increase in industry demand. The problem impacts the company’s profitability, brand strength, and market position. Which type of research study is above and what can be the research questions for this study? Explain which research design you will follow and why?
Q2. You are working in the HR department of Havells India; who have 15 state-of-the- art manufacturing plants spread across 8 locations in India. You have to study the relationship of Annual Increment (three levels 5%, 8% and 10%) and employee productivity (in units). Explain the design of experiment, independent, dependent and extraneous variable (assume any) for the study. What can be the potential threat to internal and external validity in this experiment?
Q3. In recent years, the financial landscape has witnessed significant transformations driven by advances in technology and the widespread adoption of online banking platforms. The emergence of online banking has revolutionized the way consumers engage with banks. With the increasing adoption of digital banking channels, it is crucial to assess how traditional banking methods are affected in terms of customer behavior, service demand, Trust, Security, operational adjustments and the response to the socio-demography of consumers.
a. Develop a comprehensive research plan to compare customer satisfaction and service efficiency between online and offline banking.
b. Develop a Structured questionnaire for this study.
International Finance
1. When the International Monetary Fund (IMF) conducts a comprehensive analysis of a specific economy, why does the Balance of Payments (BOP) often emerge as a crucial component? How does the paradigm shift when viewed from the perspective of the Current Account, and what role does the Capital Account play in this context? Explain the significance of these accounts in understanding the overall economic health and stability of the country.
2. In the context of international finance, how does the concept of Interest Rate Parity (IRP) influence the exchange rates between two currencies? What are the key mechanisms through which IRP affects the economic interactions and financial stability of two interconnected economies? How does this parity help in maintaining equilibrium in foreign exchange markets? Explain the implications of IRP on the exchange rate dynamics between these economies.
3a. In the realm of international trade, what significance does an Export Earners’ Foreign Currency (EEFC) account hold for global traders? How does the existence of an EEFC account facilitate the retention of foreign exchange earnings without converting them into the domestic currency? What are the key benefits and implications of this account for exporters in managing their foreign exchange reserves? Explain the role of EEFC accounts in enhancing trade efficiency and financial flexibility. (5 Marks)
b. In the context of foreign exchange management, how does Translation Risk emerge as a critical component of forex risks? What are the underlying factors that contribute to Translation Risk, and how does it impact financial statements and asset values? How do fluctuations in exchange rates exacerbate this risk for multinational corporations? Explain the significance of Translation Risk in the broader spectrum of forex risk management.
Strategic Financial Management
Q1. Oxford Corporation is evaluating a new project that requires an initial investment of INR 15,00,000. The project is expected to generate cash flows over the next five years, but there is considerable risk surrounding these cash flows due to market volatility. Based on the company’s analysis, the following information is available:
- The initial investment is INR 15,00,000
- The expected cash flows from the project for each year are as follows:
Year 1: INR 4,00,000
Year 2: INR 5,00,000
Year 3: INR 6,00,000
Year 4: INR 7,00,000
Year 5: INR 8,00,000
- The discount rate for the project is 10% and the Risk adjusted discount rate is 20%
- Determine the Net Present Value (NPV) using the Risk adjusted discount rate.
- Can the project be accepted, if the risk adjusted discount rate is increased to 25%
Q2. The board of directors of Varun Limited are deliberating over its dividend policy. As a financial analyst, you’ve been tasked with providing recommendations regarding dividend policy that align with the company’s goals and objectives. Considering the various factors influencing dividend policy decisions, analyze and provide recommendations for Varun Limited’s dividend policy.
Q3a. Digital Gadgets Ltd pays INR 10 as annual preference dividend and has the required rate of return as 12%. Compute the market price of the preference shares of Digital Gadgets Ltd? Will you buy this share if it is currently selling at INR 80 per share?
Q3b. Call Option on stock of Arvind Ltd. having expiration date of 31 Dec 2024 at a Strike price (K) of Rs.2500 is available at an option premium of Rs.200. Compute the profit/loss when the spot price is INR 2800 on 31 Dec 2024.
Financial Institutions and Markets
Q1. As a financial advisor at your advisory firm, you have a client who is seeking to diversify their investment portfolio by venturing into capital market instruments alongside their existing investments. This discussion will enable your client to make informed decisions regarding their investment strategy and portfolio diversification. Assist your client by providing comprehensive insights into various capital market instrument including their key characteristics.
Q2. Sunshine Ltd. Corporation, a fast-growing technology start-up, is poised for expansion and seeks to raise capital to fund its ambitious growth plans. The company’s management team, led by CEO John Ceth, recognizes the importance of strategically accessing the primary market to secure the necessary funds. As an advisor to the company, help the corporation to provide a brief overview on the numerous techniques as how the corporation can raise fresh capital in the primary market.
Q3A. “The capital market, a crucial component of the global financial system, serves as a platform for investors to buy and sell securities, facilitating the allocation of capital to businesses and governments. However, amidst the myriad opportunities for growth and investment, instances of scams and fraudulent activities have tarnished the integrity of the capital market “. Provide examples of regulatory interventions and their impact on restoring investor confidence. Conclude with recommendations for enhancing regulatory effectiveness in combating financial misconduct.
Q3B. India’s financial sector plays a crucial role in driving economic growth and stability. As MBA students specializing in finance, it is imperative to have a comprehensive understanding of the regulatory landscape governing financial institutions in India. Discuss the various financial Regulatory Institutions in India with their functions.
