Management Development Institute, Gurgaon Graduate Programmes Course Outline

Management Development Institute, Gurgaon
Graduate Programmes
Course Outline
Programme: PGPM
Title of the course: International Corporate Finance

Course Credit: 3 Core/Elective: Elective
Term: V Area: Accounting & Finance
Academic Year: 2020-21 Email: [email protected]
Course Faculty: Prof. Anshul Jain Contact No.: 5302
a. Introduction & Description of the course
This course is about managing firms and businesses in the current globalized world.
With the globe shrinking, firms are now more and more operating in the global arena.
Both buying from and selling to firms across the border. In addition to international
trade, overseas companies set up manufacturing facilities overseas, off-shoring &
outsourcing. “Multinational Corporations” have become a way of establishing a
business firm. These, in the Indian context, are foreign owned firms establishing their
presence in this country through a majority owned or substantially controlled Indian
entity. Or, Indian companies establishing their business presence all across the globe.
International corporate finance course addresses the need to understand management of

such businesses & the international markets and instruments.
b. Competencies
At the end of the course you should be able:
 To understand cross-border factors affecting a firm
 To understand cross-border business opportunities such as export & import
 To understand the foreign exchange market
 To study how the exposure and access to different currency and market environments
can affect the financial and investment decisions of any firm.
 To study management of exposures of the firm .
 To understand how MNEs take major international investment decisions , and
 To study how firms can finance their global operations.
c. Pedagogical Methods
The pedagogy for this course would consist of lectures, case studies, presentations by
students, exercises, group assignments and group discussions.
d. Evaluation Criteria with their weightages (an indicative evaluation component
guideline is attached#)
Sr. No. Name of Component Number Weightage

assigned
1 Quizzes 4*5 20%
2 Project Assignments 10%
4 Mid-Term Examination 1 35%
5 End-Term Examination 1 35%
Total Weightage Assigned: 100%
e. Detailed course content with Session by session Plan:
Module 1: Foundations of International Corporate Finance (Sessions 1-2)

Topics Globalization and multinational enterprises
Finance functions of a global corporation
Case & ICICI’s Global Expansion, Harvard Business School, Sept 2006, 9-706-426.
Readings Mihir A. Desai, “Finance Function in a Global Corporation”, Harvard Business
Review, July- Aug 2008.
IFM chapter 1.
Module 2: Foreign Exchange Market and Exchange Rate (Sessions 3-4)

Topics International monetary system
Balance of payments
The foreign exchange market
Exchange rate regimes and FX market in India
Case & Reserve Bank of India (2007), “Foreign Exchange Market”, Chapter VI, Report on
Readings Currency and Finance. (Refer ICF Handbook)
Ashima Goyal, “Evolution of India’s Exchange Rate Regime”,
http://www.igidr.ac.in/pdf/publication/WP-2010-024.pdf
IFM chapters 2, 3, & 5.
Module 3: Currency Risks and Derivatives Market (Sessions 5-6)

Topics Currency futures and options market
Currency swaps and interest rate derivatives
Case & Dozier Industries (A), Darden Business Publishing, 2005.

Readings Wipro’s Billion Dollar Hedge, by Prof. Jayanth R. Varma, IIMA. Readings:
Tulsi Lingareddy, (2009), Foreign Exchange Markets in India: Futures V/S Forward
Trading, the Clearing Corporation of India Ltd.
IFM chapters 7 & 14
Module 4: Exchange Rates, Markets, and the Economies (Sessions 7-10)

Topics Exchange rate policies and the macroeconomics
International parity relationships
Exchange rate determination and forecasting
Country risk analysis
Case & Country risk analysis and managing crises: Tower Associates, Thunderbird School of
Readings Global Management, 2007.
IFM chapter 6
Module 5: Exchange Rates, Currency Risk, and Firms (Sessions 11-14)

Topics Sources of foreign exchange exposures in firms
Management of transaction and translational exposures
Management of economic exposure
Case & Foreign Exchange Hedging Strategies at General Motors: Transactional and
Readings Translational Exposures, Harvard Business School, 9-205-095, 2006.
Foreign Exchange Hedging Strategies at General Motors: Competitive Exposures,
Harvard Business School, 9-205-096, 2006.
IFM chapters 8, 9, & 10
Module 6: Financing Decisions and Cross Border Investments (Sessions 15-18)

Topics International financial markets
International portfolio diversification
International capital budgeting and cost of capital
Case & ‘Innocents Abroad: Currencies and International Stock Returns’, Desai, Harvard
Readings Business School, 9-204-141, 2004.
Globalizing the cost of capital and capital budgeting at AES, Harvard Business
School, 9- 204-109, 2006.
IFM chapters 11, 12, 13, 15, 17, & 18
Module 7: Project presentations (Sessions 19-20)
f. Text Book
Eun, Cheol S. and Bruce G. Resnick (2017) International Financial Management,

McGraw-Hill, Seventh Edition
g. A list of Reference Book(s) and suggested readings:
P. K. Jain, J. Peyrard and S. S. Yadav; International Financial Management

P. G. Apte (PGA); International Financial Management
Alan C. Shapiro ; Multinational Financial Management,
A. V. Rajwade; Foreign Exchange , International Finance, Risk Management
Mark R. Eaker, Frank J. Fabozzi, Dwight Grant; International Corporate Finance
h. Other detail (if any)
The students will be assigned readings from the text book and course material pack;
and they will be expected to come to class prepared and ready to take part in class
discussions. Regular attendance helps in improved performance significantly. Students
are hence, advised to not miss classes unless absolutely essential. In case of such
absence, it is up to the student to find out what has been covered in class and get up to
speed.

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Management Development Institute, Gurgaon

Title of the course: International Corporate Finance

a. Introduction & Description of the course

International corporate finance course addresses the need to understand management of

Sr. No. Name of Component Number Weightage

e. Detailed course content with Session by session Plan:

Module 1: Foundations of International Corporate Finance (Sessions 1-2)

Module 2: Foreign Exchange Market and Exchange Rate (Sessions 3-4)

Module 3: Currency Risks and Derivatives Market (Sessions 5-6)

Case & Dozier Industries (A), Darden Business Publishing, 2005.

Module 4: Exchange Rates, Markets, and the Economies (Sessions 7-10)

Module 5: Exchange Rates, Currency Risk, and Firms (Sessions 11-14)

Module 6: Financing Decisions and Cross Border Investments (Sessions 15-18)

Module 7: Project presentations (Sessions 19-20)

Eun, Cheol S. and Bruce G. Resnick (2017) International Financial Management,

g. A list of Reference Book(s) and suggested readings:

P. K. Jain, J. Peyrard and S. S. Yadav; International Financial Management

h. Other detail (if any)

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