Financial Management & Strategic Management

Objectives: wealth vs profit maximisation · Three decisions: investment, financing, dividend · TVM: PV, FV, annuity, perpetuity, growing perpetuity

Cost of debt, preference, equity (Gordon & CAPM) · WACC computation and use as hurdle rate · Beta and systematic vs unsystematic risk

Capital structure theories: NI, NOI, Traditional, MM (with/without tax) · DOL, DFL, DCL — degree of leverage · EBIT-EPS indifference analysis

NPV, IRR, PI, Payback, ARR — formulae and decision rules · Capital rationing — PI for divisible projects · Relevant cash flows: sunk costs excluded, incremental only

Operating cycle and cash conversion cycle · EOQ, reorder level, safety stock · Cash management: Baumol model, Miller-Orr model

MM irrelevance, Walter's model (r vs Ke), Gordon's model · Bonus shares, stock split, share buyback · Factors affecting dividend policy

Long-term: equity, preference, debentures, term loans · Short-term: trade credit, overdraft, commercial paper, factoring · Finance lease vs operating lease

Vision, mission, strategic objectives hierarchy · PESTLE and Porter's Five Forces · SWOT analysis and TOWS matrix

Porter's Generic Strategies: cost leadership, differentiation, focus · Ansoff's Matrix: four growth directions · BCG Matrix: Stars, Cash Cows, Question Marks, Dogs

McKinsey 7S Framework — hard and soft elements · Balanced Scorecard — four perspectives and KPIs · SAF evaluation: Suitability, Acceptability, Feasibility