logging in or signing up DIVIDEND POLICY.UNIT-3 prabhu_gampala Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINT lite Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: Embed: Flash iPad Copy Does not support media & animations WordPress Embed Customize Embed URL: Copy Thumbnail: Copy The presentation is successfully added In Your Favorites. Views: 2849 Category: Entertainment License: All Rights Reserved Like it (8) Dislike it (0) Added: May 07, 2010 This Presentation is Public Favorites: 3 Presentation Description No description available. Comments Posting comment... By: akash.agl1 (8 month(s) ago) kindly mail me you ppt on dividend decision at my mail akash.agl1@gmail.com i vil b highly thankful 2 u thanks Saving..... Post Reply Close Saving..... Edit Comment Close By: prashantkt28 (19 month(s) ago) nice presentation please send it to me at prashantkt28@yahoo.co.in Saving..... Post Reply Close Saving..... Edit Comment Close By: vishalsoin (19 month(s) ago) please mail me this presentation as fast as possible at vishal_soin2000@yahoo.com Saving..... Post Reply Close Saving..... Edit Comment Close By: 262517 (20 month(s) ago) please mail ur presentation at denise_arcega@yahoo.com Saving..... Post Reply Close Saving..... Edit Comment Close By: prabhu_gampala (20 month(s) ago) for download mail ur mail id to me. Saving..... Post Reply Close Saving..... Edit Comment Close loading.... See all Premium member Presentation Transcript Unit – III : Unit – III Dividend Decision Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. G.Prabhakar, Dept.of Business Management, VBIT-Aushapur Meaning: : Meaning: Meaning The term ‘dividend’ refer to that part of divisible profits among its shareholders. In other words, dividend is that portion of company’s profit which is distributed among its shareholders as a percentage of par value of share or at a fixed rate per share according to the decision of its board of directors. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Slide 3: Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Different types of dividend : : Different types of dividend : Cash Dividend Stock Dividend Bond Dividend Property Dividend Special Dividend Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Dividend Policy : : Dividend Policy : Dividend Policy Dividend policy is a very significant financial decision . It determines the divisions of earnings between payments to shareholders and retained earnings. If the value of firm is a function of its dividend-pay-out ratio , the dividend policy will affect directly the firms cost of capital. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Meaning : : Meaning : Meaning ‘Dividend policy’ is a flexible and wide meaning word. This word is constituted with two words, dividend and policy. Dividend is that portion of profits of company which is distributed among its shareholders whereas policy means plan of action. Thus , the term dividend policy refers to the policy concerning quantum of profits to be distributed as dividend. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Factors influencing dividend policy : : Factors influencing dividend policy : Age of company Past dividend rate Liquidity of funds Stability in earning Expectations of shareholders Legal restrictions Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Types of Dividend Policy : : Types of Dividend Policy : Conservative Vs liberal Regular Vs Irregular Stable dividend policy Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Theories : : Theories : 1.Relevance concept 2.Irrelevance concept Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Relevance Theory : : Relevance Theory : Dividend policy is very essential for any business firm as it affects the overall value of the firm. Dividend policy is relevant & dividend decision form a very integral part of the investment & financing decision of the firm. Shareholders prefer current dividends & hence there is a direct relationships between the dividend policy & the market value of the firm. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Walter Model : : Walter Model : WALTER MODEL Dividend policy affects the value of the firm. Assumptions Valuation Optimum Payout Ratio Criticism Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Walter Model - assumptions : : Walter Model - assumptions : The firm finances all investment through retained earnings while debt and new equity is not used(Internal Financing). Business risk remains constant i.e., Constant EPS and DIV. The firm has infinite life. The firm either goes for a 100% pay-out or a 100% retention. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Valuation : Market price per share is the sum of the present value of the infinite stream of constant dividends and present value of the infinite stream of capital gains. Valuation Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Example : Example Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Optimum Payout Ratio : Optimum Payout Ratio Growth Firms – Retain all earnings Normal Firms – Distribute all earnings Declining Firms – No effect Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Criticism : Criticism No external Financing Constant Rate of Return Constant opportunity cost of capital Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Gordon’s Model : : Gordon’s Model : GORDON’S MODEL Dividend policy is relevant to the value of the company. Assumptions Valuation Optimum Payout Ratio Criticism Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Assumptions : Assumptions All Equity Firm No External Financing Constant Return and Cost of Capital Perpetual Earnings No Taxes Constant Retention Cost of Capital greater than Growth Rate Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Valuation : Valuation Market value of a share is equal to the present value of an infinite stream of dividends to be received by shareholders Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Example : Example Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Optimum Payout Ratio : Optimum Payout Ratio Growth Firms – Retain all earnings Normal Firms – Distribute all earnings Declining Firms – No effect Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. The Bird In The Hand : The Bird In The Hand Argument put forward, first of all, by Kirshman Investors are risk averters. They consider distant dividends as less certain than near dividends. Rate at which an investor discounts his dividend stream from a given firm increases with the futurity of dividend stream and hence lowering share prices. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Irrelevance Theory : : Irrelevance Theory : IRRELEVANCE THEORY Dividend policy is irrelevant to maximizing the shareholders wealth. Value of the firm is affected by the earning capacity of the firm i.e., the investment policy and not the dividend policy. Whether the firm retains its earnings or pays dividend, the market price of the share is indifferent towards it. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Modigliani & Miller Model : : Modigliani & Miller Model : MODIGILANI & MILLER MODEL The value of the firm is not affected by the decision of pay-out or plough-back.. Firms’ dividend policy have no influence on the market price of the shares. Modigliani and Miller were two staunch supporters of the irrelevance concept. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. M-M Model -- assumptions : : M-M Model -- assumptions : Perfect capital market. There are no taxes. Investment policy is fixed. No flotation cost on issue of shares. Investors behave rationally. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. M-M Model - concept : : M-M Model - concept : M-M MODEL - concept Crux of MM position is arbitrage argument. Arbitrage is entering simultaneously in two transactions which balance each other. Between dividend and retention of earnings the investors would be indifferent due to balancing nature of internal financing and external financing. So, the firm is indifferent towards the dividend decision. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. M-M Model -- criticisms : : M-M Model -- criticisms : It is wrong to assume that there are no taxes, flotation costs do not exist and there is absence of transaction costs. There is perfect capital market condition is not always true. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Other Dividends & Dividend Alternatives : Other Dividends & Dividend Alternatives Dividends Cash Stock Dividend Equivalents Stock repurchase Stock split Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Stock Dividend : Stock Dividend Stock Dividend -- A payment of additional shares of stock to shareholders. Often used in place of or in addition to a cash dividend Payment of additional shares of stock 50% stock dividend would give you 1 extra share for every 2 you already own You own 100 shares @ Rs 12 each (Rs 1200) After the stock dividend you have 150 shares at Rs 8 (RS 1200) Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Stock Split : Stock Split Change in number of shares outstanding 3 for 2 split You owned 100 shares at Rs 12 each (Rs 1200) After the split you have 150 at Rs 8 each (Rs 1200) Same impact as a stock dividend Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Equivalence of Splits and Stock Dividends : Equivalence of Splits and Stock Dividends Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Stock Repurchase : Stock Repurchase Firm uses excess cash to buy stock back from existing shareholders Substitute for a cash dividend Drives up stock price (capital gain) Increases firm leverage (less equity after repo) Method of altering firm’s capital structure Considered by some to be a cheaper form of dividend payment Used also to avoid hostile takeovers Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Rights issue : Rights issue An offer of additional shares to existing shareholders, in proportion to their holdings, to raise money for the company. Unlike a bonus issue, a rights issue is not free. The shareholder is not obliged to take up a rights issue - the offer can be allowed to lapse - but rights issues are renounceable, which means the shareholder can sell or transfer his or her right to the shares. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Bonus share issues : Bonus share issues Where a company has accumulated reserves, it may distribute these to existing shareholders by making a bonus issue of additional shares As with dividends, there will be a downward adjustment in share price when shares go ex-bonus Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Bonus share issues (cont.) : Bonus share issues (cont.) As no new capital is raised, there is no change in the assets or expected earnings of the company Example—if a bonus 1:4 issue is made Cum-bonus price Rs5.00 Market value of 4 cum-bonus shares 20.00 Theoretical value of 5 ex-bonus shares 20.00 Theoretical value of 1 ex-bonus share 4.00 Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Slide 36: Financial management – I.M. PANDEY Financial management – KHAN & JAIN Reference Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.
DIVIDEND POLICY.UNIT-3 prabhu_gampala Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINT lite Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: Embed: Flash iPad Copy Does not support media & animations WordPress Embed Customize Embed URL: Copy Thumbnail: Copy The presentation is successfully added In Your Favorites. Views: 2849 Category: Entertainment License: All Rights Reserved Like it (8) Dislike it (0) Added: May 07, 2010 This Presentation is Public Favorites: 3 Presentation Description No description available. Comments Posting comment... By: akash.agl1 (8 month(s) ago) kindly mail me you ppt on dividend decision at my mail akash.agl1@gmail.com i vil b highly thankful 2 u thanks Saving..... Post Reply Close Saving..... Edit Comment Close By: prashantkt28 (19 month(s) ago) nice presentation please send it to me at prashantkt28@yahoo.co.in Saving..... Post Reply Close Saving..... Edit Comment Close By: vishalsoin (19 month(s) ago) please mail me this presentation as fast as possible at vishal_soin2000@yahoo.com Saving..... Post Reply Close Saving..... Edit Comment Close By: 262517 (20 month(s) ago) please mail ur presentation at denise_arcega@yahoo.com Saving..... Post Reply Close Saving..... Edit Comment Close By: prabhu_gampala (20 month(s) ago) for download mail ur mail id to me. Saving..... Post Reply Close Saving..... Edit Comment Close loading.... See all Premium member Presentation Transcript Unit – III : Unit – III Dividend Decision Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. G.Prabhakar, Dept.of Business Management, VBIT-Aushapur Meaning: : Meaning: Meaning The term ‘dividend’ refer to that part of divisible profits among its shareholders. In other words, dividend is that portion of company’s profit which is distributed among its shareholders as a percentage of par value of share or at a fixed rate per share according to the decision of its board of directors. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Slide 3: Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Different types of dividend : : Different types of dividend : Cash Dividend Stock Dividend Bond Dividend Property Dividend Special Dividend Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Dividend Policy : : Dividend Policy : Dividend Policy Dividend policy is a very significant financial decision . It determines the divisions of earnings between payments to shareholders and retained earnings. If the value of firm is a function of its dividend-pay-out ratio , the dividend policy will affect directly the firms cost of capital. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Meaning : : Meaning : Meaning ‘Dividend policy’ is a flexible and wide meaning word. This word is constituted with two words, dividend and policy. Dividend is that portion of profits of company which is distributed among its shareholders whereas policy means plan of action. Thus , the term dividend policy refers to the policy concerning quantum of profits to be distributed as dividend. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Factors influencing dividend policy : : Factors influencing dividend policy : Age of company Past dividend rate Liquidity of funds Stability in earning Expectations of shareholders Legal restrictions Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Types of Dividend Policy : : Types of Dividend Policy : Conservative Vs liberal Regular Vs Irregular Stable dividend policy Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Theories : : Theories : 1.Relevance concept 2.Irrelevance concept Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Relevance Theory : : Relevance Theory : Dividend policy is very essential for any business firm as it affects the overall value of the firm. Dividend policy is relevant & dividend decision form a very integral part of the investment & financing decision of the firm. Shareholders prefer current dividends & hence there is a direct relationships between the dividend policy & the market value of the firm. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Walter Model : : Walter Model : WALTER MODEL Dividend policy affects the value of the firm. Assumptions Valuation Optimum Payout Ratio Criticism Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Walter Model - assumptions : : Walter Model - assumptions : The firm finances all investment through retained earnings while debt and new equity is not used(Internal Financing). Business risk remains constant i.e., Constant EPS and DIV. The firm has infinite life. The firm either goes for a 100% pay-out or a 100% retention. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Valuation : Market price per share is the sum of the present value of the infinite stream of constant dividends and present value of the infinite stream of capital gains. Valuation Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Example : Example Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Optimum Payout Ratio : Optimum Payout Ratio Growth Firms – Retain all earnings Normal Firms – Distribute all earnings Declining Firms – No effect Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Criticism : Criticism No external Financing Constant Rate of Return Constant opportunity cost of capital Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Gordon’s Model : : Gordon’s Model : GORDON’S MODEL Dividend policy is relevant to the value of the company. Assumptions Valuation Optimum Payout Ratio Criticism Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Assumptions : Assumptions All Equity Firm No External Financing Constant Return and Cost of Capital Perpetual Earnings No Taxes Constant Retention Cost of Capital greater than Growth Rate Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Valuation : Valuation Market value of a share is equal to the present value of an infinite stream of dividends to be received by shareholders Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Example : Example Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Optimum Payout Ratio : Optimum Payout Ratio Growth Firms – Retain all earnings Normal Firms – Distribute all earnings Declining Firms – No effect Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. The Bird In The Hand : The Bird In The Hand Argument put forward, first of all, by Kirshman Investors are risk averters. They consider distant dividends as less certain than near dividends. Rate at which an investor discounts his dividend stream from a given firm increases with the futurity of dividend stream and hence lowering share prices. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Irrelevance Theory : : Irrelevance Theory : IRRELEVANCE THEORY Dividend policy is irrelevant to maximizing the shareholders wealth. Value of the firm is affected by the earning capacity of the firm i.e., the investment policy and not the dividend policy. Whether the firm retains its earnings or pays dividend, the market price of the share is indifferent towards it. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Modigliani & Miller Model : : Modigliani & Miller Model : MODIGILANI & MILLER MODEL The value of the firm is not affected by the decision of pay-out or plough-back.. Firms’ dividend policy have no influence on the market price of the shares. Modigliani and Miller were two staunch supporters of the irrelevance concept. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. M-M Model -- assumptions : : M-M Model -- assumptions : Perfect capital market. There are no taxes. Investment policy is fixed. No flotation cost on issue of shares. Investors behave rationally. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. M-M Model - concept : : M-M Model - concept : M-M MODEL - concept Crux of MM position is arbitrage argument. Arbitrage is entering simultaneously in two transactions which balance each other. Between dividend and retention of earnings the investors would be indifferent due to balancing nature of internal financing and external financing. So, the firm is indifferent towards the dividend decision. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. M-M Model -- criticisms : : M-M Model -- criticisms : It is wrong to assume that there are no taxes, flotation costs do not exist and there is absence of transaction costs. There is perfect capital market condition is not always true. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Other Dividends & Dividend Alternatives : Other Dividends & Dividend Alternatives Dividends Cash Stock Dividend Equivalents Stock repurchase Stock split Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Stock Dividend : Stock Dividend Stock Dividend -- A payment of additional shares of stock to shareholders. Often used in place of or in addition to a cash dividend Payment of additional shares of stock 50% stock dividend would give you 1 extra share for every 2 you already own You own 100 shares @ Rs 12 each (Rs 1200) After the stock dividend you have 150 shares at Rs 8 (RS 1200) Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Stock Split : Stock Split Change in number of shares outstanding 3 for 2 split You owned 100 shares at Rs 12 each (Rs 1200) After the split you have 150 at Rs 8 each (Rs 1200) Same impact as a stock dividend Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Equivalence of Splits and Stock Dividends : Equivalence of Splits and Stock Dividends Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Stock Repurchase : Stock Repurchase Firm uses excess cash to buy stock back from existing shareholders Substitute for a cash dividend Drives up stock price (capital gain) Increases firm leverage (less equity after repo) Method of altering firm’s capital structure Considered by some to be a cheaper form of dividend payment Used also to avoid hostile takeovers Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Rights issue : Rights issue An offer of additional shares to existing shareholders, in proportion to their holdings, to raise money for the company. Unlike a bonus issue, a rights issue is not free. The shareholder is not obliged to take up a rights issue - the offer can be allowed to lapse - but rights issues are renounceable, which means the shareholder can sell or transfer his or her right to the shares. Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Bonus share issues : Bonus share issues Where a company has accumulated reserves, it may distribute these to existing shareholders by making a bonus issue of additional shares As with dividends, there will be a downward adjustment in share price when shares go ex-bonus Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Bonus share issues (cont.) : Bonus share issues (cont.) As no new capital is raised, there is no change in the assets or expected earnings of the company Example—if a bonus 1:4 issue is made Cum-bonus price Rs5.00 Market value of 4 cum-bonus shares 20.00 Theoretical value of 5 ex-bonus shares 20.00 Theoretical value of 1 ex-bonus share 4.00 Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301. Slide 36: Financial management – I.M. PANDEY Financial management – KHAN & JAIN Reference Vignana Bharathi Institute of Technology-Aushapur (V), Ghatkesar (M), R.R. Dist. – 501 301.