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CEO is considered to be the highest level of hierarchy in an organization. The general hierarchy of an organization is:
As you can see from the level of hierarchy of management, CEO reports directly to the Managing Director of the company. CEO is the one who is responsible for all ups and downs in an organization. Also he is the highest paid employee of the organization. So metimes CEO
title can also relates to president. As president title means the democracy level, the title is generally not used in many organizations.
MAJOR RESPONSIBILITIES
Financial Plans
CFO must also look forward to accounting & taxes to minimize financial risks.
Measure Performance
Shareholder Money
In general CEO must have certain individualities like leadership, strategic abilities, better communication skills etc. which hadnt been seen in CFO.
AUDI AG VALUES
Most of the time people acquaintances AUDI with its LOGO i.e. 4 Rings. In general, these rings represent the merger of four leading motor manufacturers (AUDI, WANDERER, HORCH & DKW) at the time of depression. AUDI AG is a subsidiary of Volkswagen AG ever since 1966. AUDI is
ranked no. 1 in terms of Total Quality Management (TQM) in 2012. Audi is the worlds best selling luxury automobile brand.
WHY AUDI?
These parameters fascinated most to choose AUDI. They go hand in hand with the technology. Audi had get through their targeted goals a lot of times which ensures it would sustain in future run.
FINANCIAL HIGHLIGHTS
AUDI AG stocks are traded in various stock exchange: 1. Stuttgart 2. Frankfurt A.M. 3. Dusseldorf 4. Hamburg 5. Berlin And till 31 December 2012 around 43,000,000 number of shares had been issued.
MONTHS APRIL'12 MAY'12 JUNE'12 JULY'12 AUG'12 SEPT'12 OCT'12 NOV'12 DEC'12 JAN'13 FEB'13 MAR'13
STOCK PRICE (IN EUROS) 585 560.5 530.55 540 524 521 522 515 525.1 575 565 580
% GAIN/ LOSS 0% -4.19% -5.34% 1.78% -2.96% -0.57% 0.19% -1.34% 1.96% 9.50% -1.74% 2.65%
THE PERSON WHO BOUGHT THE SHARE ON APRIL'12 AND WOULD HAVE SOLD THE SHARE YESTERDAY THEN % GAIN/ LOSS -0.85%
HE'LL BE IN A LOSS OF 0.85% EURO PER SHARE FOR EXAMPLE: HE HAD PURCHASED 15000 SHARES ON APRIL'12 TOTAL COST 8775000
NO. OF SHARES
SHARE PRICE
15000
585
AND IF HE WOULD HAVE SOLD SOLD IT YESTERDAY THEN 15000 THUS IS IN A LOSS OF EURO The most recent price of AUDI AG Share as of 17th March 2013 is 581. 580 8700000 75000
COUNTRY
FINANCIAL INSTITUTIONS
INDIVIDUAL
GOVERNMENT FIRMS
MISC.
US UK Japan Germany Australia France Canada South Korea New Zealand Singapore Switzerland Hong Kong Belgium Greece
100% 20% 10% 25% 10% 20% 35% 25% 15% 65% 55% 80% 70% 50%
0% 5% 0% 0% 5% 5% 0% 0% 0% 0% 0% 10% 0% 10%
According to the data, in US whole of the market shares are captured by individuals while in Japan & Germany the shares are equally distributed among the economy.
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COUNTRY
FINANCIAL INSTITUTIONS
INDIVIDUAL
GOVERNMENT FIRMS
MISC.
0% 0% 5% 25% 5% 15%
0% 0% 0% 15% 25% 5%
0% 0% 0% 0% 0%
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0%
Canada South Korea New Zealand Singapore Switzerland Hong Kong Belgium Greece
0% 5% 0% 0% 5% 10% 10% 0%
The financial institutions high % of ownership may lead to greater agreement degree among owners. Also Financial Institutions may be more efficient in controlling the managers than individual owners. Thus increasing Financial Institutions stock ownership in US had led to reduce the agency problem and thus enhancing the market control.
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What the firm feels that giving executive compensation helps to enhance the financials of the company. But according to the market shareholders compensation survey, it showed that returns to the shareholders was more for the companies whose CEOs salaries were under $500,000 than for those who provides their CEOs a whopping compensation.
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According to this 5 year basic chart analysis of AUDI AG, it had seen that price was fluctuating within a specified band of price limits (Between 500 to 650 Euros). The current stock price is around 580 Euros. From the chart we can see that the stock price in early 2013 had started from the trough of the limit. We can consider that the price of the stock might increase in the next year as the return on equity of the firm 31.16% which is considered to be a good in stock trading.
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STOCK PRICE (IN EUROS) 575.0 548.95 642.5 562.0 485.0 AVERAGE OF 5 YEARS
ROE of AUDI AG is 31.16% and the Average %Gain or Loss of 5 years of the stock shows a positive 6.91% value which means the stock is not a risky investment to be made. The price of stock (if we compare the previous 5 years data) had a gain of approximately 14% every year (2009, 2010 & 2011) but it fell down drastically by the same percentage i.e. 14% in the year 2012. Again stock prices went up though not as much but was a great start.
If we take an average of all these data, we can predict that in the next year we can see a hike of 6.91% of the current stock price (575.0). So we can expect around 614.73 Euro to be the stock price of AUDI AG by the year 2014.
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1904.15
2011
BOOK VALUE
BAJAJ CORP HERO MOTOCORP
214.83
214.83
214.83
29.01
29.01
29.01
2011
2012
2013
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The book value and the market value of Hero Motocorp is far more than Bajaj Corp. These both companies deals with the motorbikes production. If we compared the difference in the price of market value and book value of both these companies than Hero Motocorp had been observed to have comparably huge market value of the shares around 9 times more than book value while compared to a 7 times of Bajaj Corps.
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RISK
EXAMPLE TEXT Go ahead and replace AGGREGATE it with your own text.
RISK
RISK
RISK
1. Diversified Risk
RISK
Diversified Risk may be defined as the risk associated with few assets of the firm. Risk is generally due to the change in the price which may occur due to certain change in the market. This risk can be alleviated through diversification. Diversified Risk can also can termed as Non Systematic Risk. Diversified risk can be explained by using certain examples: Strikes between the employees of the company Suppose an Oil Firm is having a risk of drilling less or no oil
2. Un Diversified Risk Un Diversified Risk can also be termed as systematic, market or aggregate risk. This risk generally relates to the entire economy but may differ by the buying decision of the investments or purchasing the securities from different firms.
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Systematic Risk can be explained using certain examples: Earthquakes, Floods, and other weather related calamities may induce such risks
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PART B
a. Beta () for AUDI AG is 0.60. generally measures the systematic risk of the firm compared to the market. of less than 1 means that the securitys price is less volatile when compared to the market. Though it will possess less return rate, the securities would be less risky.
c. We can find the portfolio of the companies using weightage average, p = w11 + w22 + w33
Choosing two other companies, for BMW = 1.18 for Volkswagen = 1.52
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So, I would conclude as the portfolio still depicts less risk and as we know low risk, low return, we might get low returns from this stock.
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The employees at Audi AG contribute their 1 day salary to these relief fund occasionally.
This chart shows the market price of the stock of Audi AG. As we can see the cursor at 31 Jan 2013, the stock price was Euro 575.00 per share. After the event had happened the stock as we
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can see had took a hike to Euro 593.00 per share. This event had helped the company to enhance the market capitalization.
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