Advanced Financial Management Ppt
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Transcript of Advanced Financial Management Ppt
![Page 1: Advanced Financial Management Ppt](https://reader036.fdocuments.us/reader036/viewer/2022082323/540ee4e57bef0abc4c8b4990/html5/thumbnails/1.jpg)
ADVANCED FINANCIAL MANAGEMENT
Presented by: Group No.:8
Name Roll No.Prajesh Hegde 18Jaydeep Goswami 19Mihir Jani 20Priya Kariya 23Rohan Mangalure 30Harsh Mehta 34Poonam Mhatre 35
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AGENDA
1. Sources of foreign currency finance & its importance to corporate.
2. Long term financing option for the company.3. Indian financial systems relatively less
affected by the worldwide recession as compared to European & American countries.
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Sources of foreign currency finance & its importance to corporates
1. Foreign Direct Investment (FDI)2. Foreign Institutional Investor (FII) 3. Foreign AID4. Current a/c Items In Balance Of Payment A/c
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Foreign Direct Investment (FDI)• Foreign direct investment (FDI) or foreign investment
refers to the net inflows of investment.• There are two types of FDI: inward foreign direct
investment and outward foreign direct investment.
Period FDI Inflow FDI Outflow Net Inflow
1960-69 $ 42.18 bn $ 5.13 bn + $ 37.04 bn
1970-79 $ 122.72 bn $ 40.79 bn + $ 81.93 bn
1980-89 $ 206.27 bn $ 329.23 bn - $ 122.96 bn
1990-99 $ 950.47 bn $ 907.34 bn + $ 43.13 bn
2000-07 $ 1,629.05 bn $ 1,421.31 bn + $ 207.74 bn
Total $ 2,950.69 bn $ 2,703.81 bn + $ 246.88 bn
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Foreign Institutional Investor (FII)
• Institutional investors are organizations which pool large sums of money and invest those sums in securities, real property and other investment assets.
• Numerous institutional investors act as intermediaries between lenders and borrowers.
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Foreign AID
• In international relations, aid (also known as international aid, overseas aid, or foreign aid) is a voluntary transfer of resources from one country to another, given at least partly with the objective of benefiting the recipient country.
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Current a/c Items In Balance Of Payment A/c
• current account is one of the two primary components of the balance of payments, the other being the capital account.
• A current account surplus increases a country's net foreign assets by the corresponding amount, and a current account deficit does the reverse.
• The balance of trade is the difference between a nation's exports of goods and services and its imports of goods and services.
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Long term financing options for the company
• Purpose of long term finance– To Finance fixed assets– To finance the permanent part of working capital– Expansion of Companies– Increasing Facilities– Construction Projects on a big Scale– Provide Capital for funding the Operations. This
helps in adjusting the cash flow.
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Sources of Long Term Financing
Shares Debentures Public Deposits Retained earnings Term loans from banks Loan from financial institutions
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Indian Financial System relatively less affected by the worldwide recession as compared to
European and American countries
• The collapse of Lehman Brothers and other Wall Street icons lead to growing recession which affected the US, the European Union (EU) and Japan.
• The basic cause of the crisis was largely an unregulated environment, mortgage lending to subprime borrowers.
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Impact on Indian Economy
• A weakening of demand in the US affected our IT and Business Process Outsourcing (BPO) sector and the loss of opportunities for young persons seeking employment at lucrative salaries abroad.
• To lift the economy out of the recession the Government announced a package of Rs 35,000 crores in the first instance on December 7, 2008.
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Impact on Indian Economy Cont’
• The main areas to benefit were the following:a) Housingb) Textilesc) Infrastructured) Exportse) Small and Medium Enterprises (SMEs)