Subject category:
Finance, Accounting and Control
Published by:
IBS Case Development Center
Length: 4 pages
Data source: Published sources
Topics:
Dividends; Miller and Modigliani model; Dividend discount model; Indian banking sector; Earnings per share; Dividend growth rate; Equity valuation; Financial management course case; Course case maps; Course case packs; Finance for managers; Managerial finance; Business finance; Corporate finance; Financial management course case pack
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Abstract
This case was written primarily to understand the practicality of the dividend discount model (DDM) in valuing a stock price. There are various approaches for valuing the price of a stock and one of the most popular approaches is the DDM. It provides a means of developing an explicit expected return for the stock market. Besides, it is used to estimate the attractiveness of a security relative to its universe and is principally applied to stock selection. Further, the case analyses the dividend trends in the Indian banking sector. It includes an evaluation of the share price of three banking companies - Housing Development Finance Corporation Limited Bank, Punjab National Bank and the State Bank of India through DDM, and attempts to answer the following questions - Does the share price calculated through DDM and the share price prevailing in the market remain the same? If no, then what are the reasons for such differences? What are the different factors that affect the dividend payouts of the companies?
Location:
Other setting(s):
2009
Subject category:
Finance, Accounting and Control
Published by:
IBS Case Development Center
Length: 9 pages
Data source: Published sources
Subject category:
Finance, Accounting and Control
Published by:
IBS Case Development Center
Length: 6 pages
Data source: Published sources
Topics:
Dividends; Miller and Modigliani model; Dividend discount model; Indian banking sector; Earnings per share; Dividend growth rate; Equity valuation; Financial management course case; Course case maps; Course case packs; Finance for managers; Managerial finance; Business finance; Corporate finance; Financial management course case pack
About
Abstract
This case was written primarily to understand the practicality of the dividend discount model (DDM) in valuing a stock price. There are various approaches for valuing the price of a stock and one of the most popular approaches is the DDM. It provides a means of developing an explicit expected return for the stock market. Besides, it is used to estimate the attractiveness of a security relative to its universe and is principally applied to stock selection. Further, the case analyses the dividend trends in the Indian banking sector. It includes an evaluation of the share price of three banking companies - Housing Development Finance Corporation Limited Bank, Punjab National Bank and the State Bank of India through DDM, and attempts to answer the following questions - Does the share price calculated through DDM and the share price prevailing in the market remain the same? If no, then what are the reasons for such differences? What are the different factors that affect the dividend payouts of the companies?
Settings
Location:
Other setting(s):
2009
Related
Subject category:
Finance, Accounting and Control
Published by:
IBS Case Development Center
Length: 9 pages
Data source: Published sources
Subject category:
Finance, Accounting and Control
Published by:
IBS Case Development Center
Length: 6 pages
Data source: Published sources
Topics:
Dividends; Miller and Modigliani model; Dividend discount model; Indian banking sector; Earnings per share; Dividend growth rate; Equity valuation; Financial management course case; Course case maps; Course case packs; Finance for managers; Managerial finance; Business finance; Corporate finance; Financial management course case pack