Why PUMBA does not get Core-finance companies?

There are multiple reasons for this we shall look at all of them (there are not arranged in the order of Importance I personally believe each of them are equally responsible):

1. Teachers: I am not qualified to question them. But they have been at fault too. World over Teaching works on 'Pull Phenomenon' , if students show interest teachers take more efforts to make the Teaching more interesting, while if students take no interest Teacher use their ultimate punishment: "Ignore the Bastard, they will learn in good time." Perhaps its me, but I do believe PUMBA students had not reached a level that merited that kind of Punishment. The Teachers actions directly resulted in Mediocre culture of PUMBA.
2. Course Structure: Unfortunately PUMBA course structure is weak on Core-Finance Subjects or gives it a cursory reading to it. What ends up happening is that Industries end up expecting in but students have very feeble knowledge of it. The subjects where I believe PUMBA is weak are
1. Corporate Finance Basic and Applied
2. Financial Reporting and Analysis (GAPP, IFRS)
3. Security Valuation (one Half Credit subject is there)
4. Fixed Income valuation
5. Options and Future (including exotic Derivatives)
6. Macroeconomics including optional Econometrics
7. Mergers and Acquisition.
3. Application Knowledge and Case Studies :  PUMBA does not use a Case Study methodology for imparting knowledge. Why is Case Study method used? Using case studies to learn a concept is like doing a Lab experiment it helps you learn an aspect in more controlled environment, understand practial application of a subject.
4. Current News: In sequence to the above, its inherently highly important to understand current happenings in the world as Finance by nature is a very fluid subject many parts of it change because of new Innovative products that come in market and new developments that happen. Like its important to understand the demerger of Grasim and Sammruddhi Cements and Merger of Ultratech and Sammrudhi Cement on the bottom line of the related companies. Such thinking is needed if you plan to have a job as an Investment Banker, Business Analyst, Corporate Finance Job with Bank or any Company that will be affected by such a merger. Same stands for views on Bharti's  $10.8 billion takeover deal of Zain's Africa asset or Bharti's and MTN's fialed merger deal (those of you who do not know BHARTI-MTN deal would have re-written lots of rules of M&A in India). Anyone, is RIL's reported Bid for Lyondel Basell at USD 13.5 Billion justified?

But then the most important failure I believe has been of students themselves. I do not know where to begin.PUMBA students have earned a Hall of Distinction in the depths to which a man can fall profesionally.  We have an Un-professional attitude and do not appreciate realities. We want Mc Kinsey to come for placements but are least prepared to tackle them (for those who do not know Mckinsey uses Case Interview Method to select candidates. Yahan Logon se Case solve nahi hote CASE Interview kaise denge!! A simple case interview will be like I have a Cement Company that plans to enter in to emerging market. You have to advise the CEO of the company.)

As SRK said in Chak De India Mere logon mein Niyat nahi hai game kahan se khelenge. I accept SRKs diagnosis of organisation of Teams, trust me no amount of efforts will make any change if we do not have that one thing Niyat!

The Finance Forum will try to nullify some of these but we request Professionalism on part of other member parts. We do not want to waste any members valuable time. This is not a CSR initiative on any ones part. If only 6-7 people are interested in Forum. The Forum will be very happy to support them. (TRUST ME on this I would enjoy 6-7). 

So these are set Rules for the Finance Forum

1. No DELAY in submission of any assignment. (If assignments worry you do not take part in this)

2. Lectures planned are not PUMBA lectures so show some courtesy to the colleague. 

3. Be Punctual.

4. Voice you disagreements. We are interested in knowing them but remember Industry practices take primary goal. Meaning you want a Flexible schedule for all activities and submissions simply forget it. We would rather shutdown the forum than allow such banalities to ever take precedence.

Please understand implication of all this and make a right Choice for yourself.

Clarifications on Finance Related Concepts

Any doubts related to Finance for any non finance guy can be discussed in on this post. Please ask your doubt in the comments section for this post. I request finance guys to please answer the queries as they appear.

Best of luck for Exams.

Activities of Forum

Thanks Gajju for introducing this wonderful method of communication for the forum. 

I have few suggestions to make

1.  About selection of companies : There must be restriction on number of companies that can be selected  from NIFTY50 or BSE 30 as these are covered by many analyst and there would be little challenging in them unless its strategic aspect like Bhartis deal for  Zain's African opraion at USD 10.8 billion. for which the group is still un-prepared(the restriction can be up-to 4 out of 5 for this trimester). Other point on the same topic is people will have to decide before hand their rational for choosing companies on either: 
1.  technical Basis
2. Fundamental basis. 
2. If they chose these we need to decide how frequently will a technical person shall update his recommendations and what will be the role of Fundamental Analyst in it (they could come out with Annual and Quarterly earnings update)
3. PUMBA course structure lacks basic Financial knowledges that a Managers should know. I was surprised at cursory treatment given to NPV and IRR. Perhaps it might be taken in the next trimester.Thats unfortunate as other managers(marketing :( and Ops :(  ) need to understand these concepts well. So we need to Identify courses that can be covered through these forum. I am excited about IFRS and GAAP if possible and options and futures. Lets see!
4. We need to target few competitions. More about this latter on 26th
5. If HR can have its flag ship programm we need ours too I take this opportunity to solicit help of every person on Finance forum to help us(CK & Gajju)  make the Budget Progamm a grand success!!
6. I am looking for contributors for wikinvest.com more the merry, as a way of branding the forum and exposing people to analysis skills.
7. Lastly 43 is a huge number to handle we might have to think about splitting the group. (seriously 43 members group case study will be challenging ).

Finally I have two suggestion, I believe that many people who wish to take finance will in future will be associated with capital markets in one way or the other either as an Investment Banker (i hope so!) as Bankers as Financial Advisers as Corporate Financial Managers so can we adopt CFA ETHICS as code of conduct for the group. Do not worry it will be easy to get the permission from the CFA Institute. 

And the second suggestion been Professionalism. I request members to please look out in to ways of putting these at the earliest. Commitments to forum must be honored at all cost. No Force majeure clauses.

We need to discuss all these aspects and more. And this can not be just for Finance forum there are three other forums Marketing, System & Ops. But at least for finance forum I second Gajjus call lets have a general Body Student meeting of Finance students on 26th.

First Post

I take this opportunity to congratulate ourselves on having taken the first successful step in starting the Finance forum at PUMBA. Also on behalf of the forum members i suggest the following modus operandi for the functioning of the forum. Kindly go through the same and give your suggestions for the modification to the same.

1. We shall start the forum from the first working day of the next trimester.

2. The forum members shall meet at least twice a week (i.e 2 session of 3 hrs each per week). Days shall be decided once the time table for the next trimester is displayed.

3. The forum shall be involved in following activities to start with
Case studies (Group and individual)
Presentations (Group and individual)
Tasks (Group and individual)
Financial market updates - kind of Finance Quiz.
Short discussions on important conceptual topics

4. As this is a voluntary group attendance is not compulsory (but you should make sure that you complete the assigned work and update the same on the blog without fail and without excuses).

5. Point system, however is applicable (nature of point system shall be decided in our first general body meet).

6. Any other additional points are welcome as suggestions from your side.

I had mentioned that the forum should try and meet on 26th of Feb ie on the last day of the exams, now i feel nobody would be interested in meeting on that day as the end of exams shall mark a beginning of a few days of refreshment and enjoyment period. So i share my views on what i wanted to share on that day. This would be the part of the first individual assignment we take for ourselves.

I suggest each member of the forum be given a hypothetical amount of Rs 1,00,000/- and she/he comes up with an investment portfolio comprising of not more than 5 stocks (traded on NSE) on the first day of the next trimester. Task doesn't end there as each member shall have to come up with his rational behind selection of the stocks portfolio in form of a presentation. You may base your findings on either fundamental or technical analysis or both. This shall keep us busy during the vacations and also would give us an opportunity to learn stock valuations and get a pulse of the current market situation. It will also help you to try and understand the balance sheets of a few companies that you might select. Even if you do not understand much about the market or any other basic concept, at least try doing it reading some books or searching over the net. In case of any problem you can always direct them on the blog or contact any other member who knows it.

I am also sharing the list of all interested members of our forum with you. I would like to make this blog as a means for sharing data and updates of our forum so do make it a point to keep visiting it on a regular basis. This will help to avoid flooding of emails in our mailbox. However, those interested in getting all updates can definitely subscribe for the same on the blog page. I have also sent you invitations to join the blog, do accept the invitation and be a follower.

Three cheers...
PUMBA Finance Forum