FINANCIAL MANAGEMENT IN HEALTHCARE – Stock Markets

13th Jan 2012

By Atul Kochhar

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Topics to be covered today

Understanding Stock Markets & terms used in context to Stock market

Obligations of Corporate (healthcare company) with respect to Stock markets

ERP Systems

Business models of existing hospitals working in India – Apollo v/s Fortis

Banks

Definitions

EQUITY

Ownership interest in a corporation in the form of common stock or preferred stock. It also refers to total assets minus total liabilities, in which case it is also referred to as shareholder's equity ornet worth or book value. In real estate, it is the difference between what a property is worth and what the owner owes against that property (i.e. the difference between the housevalue and the remaining mortgage or loan payments on a house)

STOCK

An instrument that signifies an ownership position (called equity) in a corporation, and represents a claim on its proportional share in the corporation's assets and profits. Ownership in the company is determined by the number of shares a person owns divided by the total number of shares outstanding. For example, if a company has 1000 shares of stock outstanding and a person owns 50 of them, then he/she owns 5% of the company. Most stock also provides voting rights, which give shareholders a proportional vote in certain corporate decisions. Only a certain type of company called a corporation has stock; other types of companies such as sole proprietorships and limited partnerships do not issue stock.

Definitions

DERIVATIVE

A derivative is an agreement or contract that is not based on a real, or true, exchange, i.e.: There is nothing tangible like money, or a product, that is being exchanged. For example, a person goes to the grocery store, exchanges a currency (money) for a commodity (say, an apple). The exchange is complete, both parties have something tangible. If the purchaser had called the store and asked for the apple to be held for one hour while the purchaser drives to the store, and the seller agrees, then a derivative has been created. The agreement (derivative) is derived from a proposed exchange (trade money for apple in one hour, not now).

Futures Options

Definitions

FUTURES

A standardized, transferable, exchange-traded contract that requires delivery of a commodity, bond, currency, or stock index, at a specified price, on a specified future date.

OPTIONS

The right, but not the obligation, to buy (for a call option) or sell (for a put option) a specific amount of a given stock, commodity, currency, index, or debt, at a specified price (the strike price) during a specified period of time. For stock options, the amount is usually 100 shares. Each option has a buyer, called the holder, and a seller, known as the writer. If the option contract is exercised, the writer is responsible for fulfilling the terms of the contract by delivering the shares to the appropriate party. In the case of a security that cannot be delivered such as an index, the contract is settled in cash. For the holder, the potential loss is limited to the price paid to acquire the option. When an option is not exercised, it expires. No shares change hands and the money spent to purchase the option is lost. For the buyer, the upside is unlimited.

General Gyaan on Stock ExchangeStatutory filing of quarterly accounts with Stock Exchange

Statutory filing of important communication with Stock Exchange

IPO Initial Public offer

BSE Bombay Stock Exchange

NSE National Stock Exchange

FPO Follow on Public offer

Book Building The process of determining the price at which an Initial Public Offering will be offered. The book is filled with the prices that investors indicate they are willing to Pay per share, and when the book is closed, the issue price is determined by an underwriter by analyzing these values

Sensex / Nifty

Topics to be covered today

Understanding Stock Markets & terms used in context to Stock markets

Obligations of Corporate (healthcare company) with respect to Stock markets

ERP Systems

Business models of existing hospitals working in India – Apollo v/s Fortis

Banks

Topics to be covered today

Understanding Stock Markets & terms used in context to Stock markets

Obligations of Corporate (healthcare company) with respect to Stock markets

ERP Systems

Business models of existing hospitals working in India – Apollo v/s Fortis

Banks

Topics to be covered today

Understanding Stock Markets & terms used in context to Stock markets

Obligations of Corporate (healthcare company) with respect to Stock markets

ERP Systems

Business models of existing hospitals working in India – Apollo v/s Fortis

Banks & other topics

THANK YOU