a k s t u i s k u w m u k o p l h u i o t r f d c v b n m k l o i u y t r e g t r e w s a d f g h j...

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t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y t r I o u y t j k l m n b v c x zz z z w w t t y y y u g gd d s n m k I u j h o p u y t r n j u I o u y t r f g h j h h j k I o u h j n h y m k j u y t m k iu y t h g f ds d f r e s d f re s d f r g t y h b v c z z x e w s d f r p o I l m k j u n h y g b n j u y o l p m n b j u y h g t I o p l m nj j I u j k m n j I k m n j I I v f r t y h b v g t y h b g t y h b v f r u I o k m n j I o p l m er d s a q w e r d c f v g t yu h b u I o j k m n h yu I o l o p p v b n m x c v b n x c v g t r f v b nm c f r t g t y h b vc x d e s

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Page 1: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e

G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y r r

O o p y t r I o u y t j k l m n b v c x zz z z w w t t y y y u g gd d s e

r f b n m k I u j h o p u y t r n j u I o u y t r f g h j h h j k I o u y m n

O I u h j n h y m k j u y t m k iu y t h g f ds d f r e s d f re s d f r e s

d c v g t y h b v c z z x e w s d f r p o I l m k j u n h y g b n j u y h

m k I o l p m n b j u y h g t I o p l m nj j I u j k m n j I k m n j I I o r

t g b v f r t y h b v g t y h b g t y h b v f r u I o k m n j I o p l m n j I

Q w e er d s a q w e r d c f v g t yu h b u I o j k m n h yu I o l o p p

N bc v b n m x c v b n x c v g t r f v b nm c f r t g t y h b vc x d e s

Page 2: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

I. KTIKARI

II. PVESHUR

III. STIWA

IV. NTASHKEEV

V. LUVPI

KRITIKA

PURVESH

SWATI

VENKATESH

VIPUL

Page 3: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

(Do Mulgi Teen Mulge)

(Do Mulgi Teen Mulge)

Kritika jaInnKritika jaInn

Purvesh mogHe

Purvesh mogHe

Swati hasiJaa

Swati hasiJaa

Venkatesh viswanaThan

Venkatesh viswanaThan

Vipul raWallVipul raWall

Team - D

ecrypter

s

Page 4: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

OV

ERV

IEW

OV

ERV

IEW What is Debt Capital?

What is Debt Capital?What are types/sources of Debt

What are types/sources of Debt

Capital?Capital?Debt Capital v/s Share Capital

Debt Capital v/s Share Capital

What is Cost of Capital?

What is Cost of Capital?

Page 5: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

CapitalCapital

ShareDebt

Internal

Page 6: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt

Capit

al

Debt

Capit

al

Debt capital is the money borrowed for a

fixed period of time at

a specific interest rate.

Page 7: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Types o

f Debt C

apita

l

Types o

f Debt C

apita

l LoansLoans

- private- private(banks, institutions)

(banks, institutions)

- non-transferable

- non-transferable

Bond/Debenture

Bond/Debenture

- public - public (individuals and

(individuals and

institutions)institutions)

- transferable

- transferable

Page 8: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Mr. ZooZee meets Master Shifu

Page 9: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Share

Capit

al

Share

Capit

al

v/s

v/s

Debt

Capit

al

Debt

Capit

al OwnershipFaith FactorRisk QuotientRepaymentCost of Capital

Page 10: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share Capital

Ownership

Page 11: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

OWNERSHIP

OWNERSHIP

Share Capital – Share Capital – ‘owned’ ‘owned’

Debt Capital – ‘owed’ Debt Capital – ‘owed’

Page 12: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share CapitalFa

ith F

acto

r

Ownership

Page 13: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

FAITH FAITH FACTOR

FACTOR

Share Capital –’faith’ Share Capital –’faith’

Debt Capital – ‘no faith’Debt Capital – ‘no faith’

Page 14: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share Capital

Faith

Fac

tor

Risk Quotient

Ownership

Page 15: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

RISKRISK QUOTIENTQUOTIENT

Share – onus on Share – onus on shareholders shareholders

Debt – rated by agencies Debt – rated by agencies

Page 16: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share Capital

Faith

Fac

tor

Risk Quotient

Repay

men

t

Ownership

Page 17: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

REPAYMENT

REPAYMENT

Share – cannot claim Share – cannot claim moneymoney

Debt – repayment on Debt – repayment on maturitymaturity

Page 18: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share Capital

Faith

Fac

tor

Risk Quotient Rep

aym

ent

Cost of

Capital

Ownership

Page 19: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Share – Dividend (iff Share – Dividend (iff profit)profit)

Debt – fixed interest rate Debt – fixed interest rate (no matter what)(no matter what)

COST OF COST OF CAPITALCAPITAL

Page 20: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share Capital

Faith

Fac

tor

Risk Quotient Rep

aym

ent

Cost of

Capital

Ownership

Page 21: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Cost

of

Capit

al

Cost

of

Capit

al

CoC = CoS + CoD + CoI

Dividend

Zero

Interest

0 – 100% (or even more) on the Face Valueand not on the Issue Price

~ 10%

Page 22: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

Debt Capital v/s Share CapitalDebt Capital v/s Share Capital

Share Debt

Page 23: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

WA

CC

/IR

RW

AC

C/IR

R

WACC – WACC – Weighted Avg. of Weighted Avg. of

Cost of CapitalCost of Capital

IRR – IRR – Internal Rate of ReturnInternal Rate of Return

Page 24: A k s t u I s k u w m u k o p l h u I o t r f d c v b n m k l o I u y t r e G t r e w s a d f g h j j k l m n b v c x z f g h j k li I u y tr r e o u y

DhanyawaaDhanyawaadd

Thank youThank youSpasibaSpasibaMerciMerci

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