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Course Syllabus

2023/2024

Building DCF Models in Practice

Category 'Best Course for Career Development'
Category 'Best Course for Broadening Horizons and Diversity of Knowledge and Skills'
Type: Mago-Lego
Delivered by: HSE Banking Institute
When: 2 module
Open to: students of one campus
Instructors: Alexey Ilyin
Language: English
ECTS credits: 3
Contact hours: 30

Course Syllabus

Full Syllabus

Abstract

This is a practical course. Over the course, students will build financial models for capital investment projects ranging from venture companies to project finance. We will study best practice for presenting project budgets, calculating ratios and performance indicators, doing risk analysis. The course will develop financial modelling skills used in the business valuation course, but in contrast in this course we will focus on business factors and drivers fuelling success of a project, and will spend more time on their best account and presentation than on the theory of financial analysis. The course is interactive. Lectures combine a presentation, discussion of reading for the week (often the homework), viewing of a video and discussion. Students should take notes, both on lectures and on the reading, and presentations, with the intention of addressing the key themes of the course. The readings require intensive examination of a broad variety of issues and modes of thought.
Learning Objectives

Learning Objectives

  • The goal of the course is to provide practical skills in financial modelling of investment projects by discussing best practice with the teacher as well as students work on their own projects
Expected Learning Outcomes

Expected Learning Outcomes

  • After the course, students will have necessary knowledge and skills to build a fully fledged financial model for a project or a company. The model can be used to support investment decisions, raise capital or apply for debt financing
Course Contents

Course Contents

  • Basics of financial modelling
  • Sales, OPEX, CAPEX, working capital, taxes
  • Financial reports in the model
  • Financing: loans, lease. Ratios
  • Discounted cash flow analysis
  • Scenario analysis
Assessment Elements

Assessment Elements

  • non-blocking Group assignment
    The students are required to choose a project with a new business (either a green field project or a new business line for an existing company) and develop a financial model
  • non-blocking financial model
Interim Assessment

Interim Assessment

  • 2023/2024 2nd module
    0.4 * Group assignment + 0.6 * financial model
Bibliography

Bibliography

Recommended Core Bibliography

  • McKinsey & Company Inc, Tim Koller, Marc Goedhart, & David Wessels. (2020). Valuation : Measuring and Managing the Value of Companies, University Edition. Wiley.
  • Rosenbaum, J., & Pearl, J. (2013). Investment Banking : Valuation, Leveraged Buyouts, and Mergers and Acquisitions (Vol. 2nd ed). Hoboken: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=981384

Recommended Additional Bibliography

  • Nantell, T. J. (1991). Valuation: Measuring and Managing the Value of Companies. Journal of Finance (Wiley-Blackwell), 46(1), 459–463. https://doi.org/10.2307/2328707