International School of Business & Media, Financial Markets Assignment

This document is an assignment outline for the 'Financial Markets and Services' course within the International School of Business & Media's PGDM program (Batch 2020-22, Third Trimester 2021). The course aims to provide students with a comprehensive understanding of the Indian financial system, including its components, functions, and impact on business enterprises. The assignment details the course objectives, outcomes, and a modular breakdown of topics such as the financial system, money and capital markets, primary and secondary markets, financial institutions, mutual funds, and financial services. Each topic includes pre-session readings, classroom session details, and learning outcomes, along with evaluation weightage and recommended textbooks. The course emphasizes the application of financial concepts and analysis of real-world scenarios, preparing students to make informed financial decisions and navigate the complexities of the Indian financial landscape. This assignment is a valuable resource for students studying finance, offering insights into the structure and function of India's financial markets.

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International School of Business & Media
PGDM Batch 2020 – 22
Third Trimester’2021
Course: Financial Markets and Services
Faculty: Dr. N Venkatesh Kumar
[e-mail]
BRIEF COURSE OUTLINE
After the structured economic reforms couple of decades ago, the Indian financial system
has become robust and evolved as complex ecosystem with greater degree of market
integration. By virtue of this, a finance professional needs knowledge of best financial
management practices within the organization as well as financial systems that influence
the organization from outside. The financial system comprises of financial institutions,
financial markets, financial instruments, financial products, and services. A thorough
understanding of all these components will equip a finance manager to make better and
informed decisions. Hence, the course on “Indian Financial Markets and Services”
expected to orient the learner all the external forces influencing financial and strategic
decisions of a business enterprise.
COURSE OBJECTIVES
1. To provide an insight into the functioning of Indian financial system.
2. To make students understand the various components of the financial system, the
inter-relationship among different components and the impact on business
enterprise.
COURSE OUTCOMES
After the completing the course, Students would be able to:
1. Students will be able to recall the basic framework of Indian Capital Markets and
its functions.
2. Students will be able to elaborate various products and services in financial
markets.
3. Students will be able to enumerate the various institutional set-ups in India and
their value offerings and apply rationally.
4. Students will be able to critically analyse the financial viability of financial
products and services.
5. Students will be able to evaluate various financial products in Indian Financial
Market and distinguish their relative merits and demerits.
6. Students will be able to construct appropriate financial assets for the prospective
investors.

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Modular Topics
Topic: 1 – The Financial System: An Introduction
Sessions: 1, 2, 3
Pre-session
Reading
www.rbi.org.in : Read database on Indian economy. Understand about the
trends in Savings and Investment; Household sector financial savings
Classroom
Session
Introduction to Financial System, Components of the formal financial system,
Functions of the financial system, Key factors of a well-functioning financial
system, The financial system and economy, Types of economic units,
Relationship between financial system and economic growth, Reforms in the
financial system
Blooms learning
level Level 1, 2, 3
Conceptual
Exercises/
Application
Exercises/
Case Study
Cause and Effect model: OLS regression to analyse the trend pattern considering
Savings and Investment in India
Learning
Outcome
Understand the Indian financial system and its significant role in Indian
economy
Topic: 2 – Financial Markets: Money Market
Sessions: 4, 5
Pre-session
Reading
www.rbi.org.in 1) Understand the concept of Money supply and classification
and T-bills
Classroom
Session
Functions of Money market, Benefits of efficient money markets, Money
market instruments: Treasury Bills, Commercial Paper, Commercial Bills,
Certificate of Deposits (CDs), Call and Notice Money market, Mumbai Inter-
bank offer rate (MIBOR), Collateralised Borrowing and Lending Obligation
(CBLO), Tools for Managing liquidity in the Money market
Blooms learning
level Level 1 and 2
Conceptual
Exercises/
Application
Exercises/
Case Study
Discussions through conceptual exercises
Learning
Outcome Deep understanding about the Indian Money markets and the instruments

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Topic 3 – Financial Markets: Introduction to Capital Market
Session: 6
Pre-session
Reading Basic understanding about Indian Capital markets
Classroom
Session
Introduction to Primary and Secondary market, Functions of capital market,
Reforms in capital market
Blooms learning
level Level 1, 2, 3 and 4
Conceptual
Exercises/
Application
Exercises/
Case Study
Capital Market Scams:
1. Harshad Mehta Scam
2. Ketan Parekh Scam
Learning
Outcome Understand the functions of capital markets in mobilising the resources
Topic 4 – Financial Markets: The Primary Market
Session: 7, 8, 9
Pre-session
Reading
Basic knowledge about Initial Public Offering (IPOs) and other forms of raising
capital from the institutions and retail investors. www.bseindia.com,
www.nseindia.com
Classroom
Session
The Primary market: Free pricing mechanism, Primary issues and its forms,
Process of Book building, Green shoe option, Institutional placement
programme, Resources mobilization form international markets, New financial
instruments
Blooms learning
level Level 1, 2, 3 and 4
Conceptual
Exercises/
Application
Exercises/
Case Study
Examination of recent public issues:
1. Indigo Paints
2. Home First Finance company India Limited
3. Stove Kraft Limited
Learning
Outcome
Learner would have understood the new mechanism of price discovery in public
issues and post risk mitigation strategies, Assimilating new avenues for
prospective investment

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Topic 5 – Financial Markets: The Secondary Market, Derivatives and Debt Market
Session: 10, 11, 12, 13
Pre-session
Reading
Basic understanding about the trading mechanism in stock exchanges.
www.bseindia.com, www.nseindia.com. Role of Depository participants (DPs)
Classroom
Session
Functions of secondary market, Development of stock market in India, Listing
of securities, Risk management, Trading arrangements, Bulk, Block and
Negotiated deals, Rolling settlement, Bombay Stock Exchange (BSE), National
Stock Exchange (NSE), Regional stock exchanges, Market making system,
Introduction to derivatives market: Forwards and Futures, Options, Introduction
to Debt market: Link between Money market and Debt market, Private
corporate Debt market, PSU Bond market and Government securities market
Blooms learning
level Level 1, 2, 3 and 4
Conceptual
Exercises/
Application
Exercises/
Case Study
Discussion through live trading terminal
Learning
Outcome
Learner would have learnt about trading in cash segment and other avenues
available for risk mitigation
Topic 6 – Financial Institutions
Session: 14, 15
Pre-session
Reading
Basic understanding about Banking and Non-Banking Financial Institutions in
India
Classroom
Session
Development of Financial institutions, Industrial Finance corporation of India
Limited (IFCI), Small Industries Development Bank of India (SIDBI), EXIM
Bank, National Bank for Agriculture and Rural Development, Banking and
Non-Banking Institutions: Functions of Bank, Scheduled commercial banks:
Public sector banks, Nationalised banks and Private sector banks, Reforms in the
banking sector, Stress testing, The Basel Accord (Common Equity Tier 1 capital
and Additional Tier 1 capital), Non-Banking financial companies
Blooms learning
level Level 1, 2
Conceptual
Exercises/
Application
Exercises/
Case Study
Discussion about BCBS and BA-I, BA-II and BA-III
Learning
Outcome
Learner would have understood about the functions of Banking and Non-
Banking financial institutions in India and framework of BCBS

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Topic 7 – Mutual Funds
Session: 16, 17
Pre-session
Reading www.amfiindia.com
Classroom
Session
Introduction to Mutual funds, Benefits of investing in Mutual funds, History of
Mutual funds in India, Mutual fund organisation, Role of intermediaries in the
Indian mutual fund industry, Classifications of mutual fund schemes, Role of
Association of Mutual Funds in India (AMFI), Risk and Return in mutual
funds, Evaluation of mutual fund schemes (Reward to volatility ratio, reward
to risk ratio, Predictive ability model: Jensen’s Alpha)
Blooms learning
level Level 1, 2, 3, 4 and 5
Conceptual
Exercises/
Application
Exercises/
Case Study
Fact sheet analysis and Live project
Learning
Outcome
Learner would have understood the art of minimizing the risk exposure
through mutual fund investments and evaluating the mutual fund’s
performance through various risk-adjusted ratios
Topic 8 – Financial Services
Session: 18, 19, 20
Pre-session
Reading
Basic understanding about the role of financial services rendering institutions.
www.crisil.com, www.icra.in, www.fitchratings.com.
Classroom
Session
Investment Banking, SEBI Regulations, Pre and Post issue obligations,
Depositories (NSDL and CDSL) and Custodians, Credit rating, Factoring,
Leasing, Financial Inclusion and Microfinance
Blooms learning
level Level 1, 2, 3, 4, 5 and 6
Conceptual
Exercises/
Application
Exercises/
Case Study
Numerical cases on Leasing
Learning
Outcome
Understanding the role merchant bankers, Significance of rating of financial
securities and role of rating agencies, Financial tools to facilitate the business
operations, Significance of financial inclusion for the holistic rural
development

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EVALUATION WEIGHTAGE
1. Individual Live Project: 30 Marks
2. Presentation: 5 Marks
3. Class Participation and Quiz: 5 Marks
4. Viva: 10 Marks
5. Assignments: 20 Marks
6. End Term: 30 Marks
RECOMMENDED BOOKS
1. Indian Financial System – Bharati B Pathak
2. Indian Financial System – M Y Khan
3. Indian Financial System – Saha
4. Financial Institutions and Markets – L M Bhole