BPP University: MSc Finance, Vodafone Financial Strategy Report

This report provides a comprehensive analysis of Vodafone's financial strategy over the past decade. It begins with a description of the company's history and key events impacting its financial strategy, followed by an in-depth analysis of its financial strategy, including financial risk, currency exposure, and debt funding. The report then evaluates Vodafone's performance against the Seven Rappaport Value Drivers and assesses its financial strategy within the context of its corporate lifecycle. A critical evaluation of the company's dividend policy and its impact on shareholder value is also included, referencing academic theories where appropriate. The report aims to provide an investor with a thorough understanding of Vodafone's financial health and strategic decisions.

Msc. Management (Finance): Level 7
Total Word Counts: 3,500
2.1 Assessment Brief
Please read the article entitled “Dividend Security” from Canaccord Genuity Wealth
Management, and the related article “Safe haven Vodafone among FTSE 100 companies at risk of
dividend cuts” from the Daily Telegraph on 7th May 2016 which can be found here:
http://www.telegraph.co.uk/investing/shares/safe-haven-vodafone-
among-ftse-100- companies-at-risk-of-dividend/
Choose ONE company from the companies that are mentioned in the Telegraph article and that
are listed below:
Brammer Rio Tinto
De La Rue Stanley Gibbons
Dee Valley Tate & Lyle
Diageo Vedanta
Electrcomponents Vesuvius
Fenner Vodafone
Immarsat Weir
ITE
Write a report to an investor considering investing in the company that you have selected, reporting
on the following areas:
(a) A description of the company’s history over the last 10 years, and key events affecting their
financial strategy (10 marks)
(b) Analyse the different aspects of the company’s Financial Strategy over the last 10 years
(10 marks)
(c) The company’s performance against the Seven Rappaport Value Drivers (20 marks)
(d) A critical evaluation of each aspect of the company’s financial strategy in the context of
where it is in its corporate lifecycle (20 marks)
(e) A critical evaluation of the company’s dividend policy and its impact on shareholder value
(20 marks)
Total (80 marks)
You should make reference, where possible, to appropriate academic theories.

2.1. Assessment Marking Scheme (Student Version)
The assignment is marked out of 80. The following table shows the mark allocation and the approach
required.
Assignment Part Mark Approach
A description of the company’s This section should analyse those external
history over the last 10 years, factors that have affected the company’s
and key events affecting their choices for different aspects of its financial
financial strategy 10 marks strategy, including mergers & acquisitions,
regulation, industry & market maturity,
changes in enabling technologies, changes
in the company’s leadership and any other
specific factors relevant to the company.
Analyse the different aspects of Analysis of the different aspects of the
the company’s Financial company’s Financial strategy including its
Strategy over the last 10 years 10 marks financial risk (including its debt rating),
currency exposure, and debt funding
strategy.
The company’s performance You should critically analyse the
against the Seven Rappaport company’s performance on each of the
Value Drivers seven Rapaport Value Drivers over time,
. within a framework of whether they
20 marks contribute to the company creating
Shareholder Value.
An excellent answer will also compare
performance on the Value Drivers against
the company’s peer group.
A critical evaluation of each You should evaluate the company’s
aspect of the company’s financial strategy in the context of the
financial strategy in the context corporate lifecycle models discussed in
of where it is in its corporate class.
lifecycle
An excellent answer will compare the
capital structure and consequent financial
20 marks risk with the company’s business risk and
where it is in its lifecycle. Academic
theories on capital structure should be used
to critically assess whether the company is
optimizing shareholder value creation.
A critical evaluation of the Students should critically compare the
company’s dividend policy 20 marks company’s stated dividend policy with the
and its impact on shareholder ways in which the company has returned
value
BPP University Business School: September 2015

profits to shareholders over the
last 10 years.
An excellent answer will compare the
dividend policy against a range of
academic theories, and in the context
of the company’s financial position.
You should also discuss the extent to
which dividend policy has contributed to
the company’s Total Shareholder Return.
Total 80 marks
Appendix A - General Level 7 Grading Criteria
Criteria Pass Grades Fail Grades
High Distinction Merit Pass Fail Low Fail
Distinction 70-84% 60-69% 50-59% 30-49% 0-29%
85-100%
The work The work The work The work The work The work
displays: displays: displays: displays: displays: displays:
Knowled (a) Strong (a) Clear (a) Clear (a) Evidence of (a) Evidence of (a) Evidence of
ge & evidence of a evidence of a evidence of a a systematic an a limited
Understa comprehensive comprehensive comprehensive understanding, understanding understanding
nding and systematic and systematic and systematic which may of an of issues,
(a) understanding understanding understanding contain some appropriate concepts,
Systemati of an extensive of a of all major - gaps, of all range of theories and
c range of considerable and some major - and issues, research either
Understan appropriate variety of minor - issues, some minor - concepts, major and/or
ding issues, issues, concepts, issues, theories and minor.
(b) concepts, concepts, theories and concepts, research but
theories and theories and research theories and has significant
Emerging research research research gaps or
Thought misunderstandi
ngs.
(b) Sustained (b) Precise and (b) Some clear (b) Clear (b) Unclear or (b) Significant
excellence in well-judged evidence of the evidence of an imprecise gaps in the
the application application of application of understanding understanding understanding
of thoughts and thoughts and thoughts and of thoughts and of thoughts and of the debates
practices at the practices at the practices at the practices at the practices at the at the forefront
forefront of the forefront of the forefront of the forefront of the forefront of the of the
discipline discipline discipline discipline. discipline. discipline.
Argumen (a) Consistently (a) Consistently (a) Precision, (a) Broad (a) Errors (a) A lack of
t precise, precise, accuracy and levels of which affect the precision,
(a) accurate and accurate and clear reasoning precision, consistency of accuracy or
Analysis, reasoned reasoned throughout the accuracy and the analysis, reasoning in
Synthesis analysis, analysis, analysis, reasoning in synthesis or analysis,
& synthesis synthesis synthesis analysis, evaluation synthesis or
Evaluation and/or and/or and/or synthesis and/or key evaluation with
evaluation; evaluation evaluation and/or gaps in the significant gaps
BPP University Business School: September 2015

Criteria Pass Grades Fail Grades
High Distinction Merit Pass Fail Low Fail
Distinction 70-84% 60-69% 50-59% 30-49% 0-29%
85-100%
The work The work The work The work The work The work
displays: displays: displays: displays: displays: displays:
(b) addressing addressing all addressing all evaluation, and issues in the issues
Numerical issues with issues, some issues addresses all addressed addressed
Analysis insight or with creativity appropriately key issues
(c) originality
Argument (b) Numeric (b) Numeric (b) Numeric (b) Numeric (b) Numeric (b) Numeric
ation analysis that is analysis that is analysis that is analysis that is analysis that is analysis that is
(d) complete and complete and complete and mostly mostly incomplete or
Independ free from errors mostly free mostly free complete and complete but contains errors
ent with application from errors with from errors with free from contains errors which have
Research of methods that fluent and relevant and significant or with significant critical effect,
may be appropriate effective critical errors effect, or or methods that
insightful or application of application of with methods that are applied
original methods. methods. appropriate are applied inappropriately
application of inappropriately
methods.
(c) Extremely (c) Extremely (c) Evidence of (c) Evidence of (c) Evidence of (c) Lack of
strong and strong and an argument an overall a consistent consistency or
consistent consistent that is convincing argument but structure in the
argument that argument but
argument generally may have argument.
convincingly may have
making a convincing with weaknesses, Seriousaddresses issues weaknesses,
convincing including a good internal gaps or significant gaps weaknesses in
whole with uncertainties and consistency inconsistencies. or be the integration
evidence of conflicts. and addresses Clear use of unconvincing. of evidence
originality. Excellent use of most issues. information Clear use of and/or no
Impressive information Very good use gathered but may information awareness of
gathered which to have some
dexterity in the of information gathered but the limitations
support and weaknesses in
use of gathered to may not be or weaknessesfurther the the integration
information argument support the into the sufficient to of the research.
gathered to argument. argument. sustain the
support the argument.
argument.
Argumen (d) Evidence of (d) Substantial (d) Clear (d) Appropriate (d) Evidence of (d) Over
t an innovative or research and evidence of use of a wide a range of reliance on
(continue original use of evidence of an considerable range of personal very restricted
d) extensive innovative use personal personal research but range of
personal of a wide range research and research which evidence of personal or
(d) research which of personal the use of a is critically methodological secondary
has been research with diverse range evaluated for or conceptual research much
Independ thoroughly clear and of appropriate key conceptual evaluation may of which may
ent critically consistent sources but and be limited, not be
Research evaluated both critical may contain methodological inconsistent or evaluated and
conceptually evaluation both problems with issues although inappropriate may not be
and conceptually consistency in this may not be directly related
methodologicall and the conceptual consistent to the question
y methodologicall and throughout or area
y methodological
critical
evaluation
Presentat (a) Excellent (a) Excellent (a) Good (a) Adequate (a) Adequate (a) Poor
ion structure and structure and structure and structure and structure and structure and
(a) presentation presentation presentation presentation presentation presentation
Structure (b) Precise, full (b) Precise, full (b) Full and (b) Good (b) Competent (b) Poor
and appropriate and appropriate references and references and references and
appropriate references and notes with notes but may notes with
BPP University Business School: September 2015

Criteria Pass Grades Fail Grades
High Distinction Merit Pass Fail Low Fail
Distinction 70-84% 60-69% 50-59% 30-49% 0-29%
85-100%
The work The work The work The work The work The work
displays: displays: displays: displays: displays: displays:
(b) references and references and notes with minor or contain multiple
Referenci notes. notes. minor or insignificant inconsistencies inconsistencies
ng insignificant errors or , errors or , errors or
(c) Use of errors omissions omissions omissions
Language (c) Subtle use (c) Precise use (c) Clear and (c) Generally (c) Generally (c) Serious
of language of language precise use of clear use of understandable errors in the
expressing expressing language language use of use of
highly nuanced complex allowing a sufficient for language but language which
thought with thought with complex arguments to significant makes
clarity and clarity, argument to be be readily errors in meaning
precision to a accuracy and easily understood and expression unclear or
level precision which understood and followed affecting imprecise
appropriate for furthers and followed overall clarity
submission for enhances the
publication. argument
---------- Student Assessment Ends ----------
BPP University Business School: September 2015