merchant banking revised jan 19th

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Presented by Rajesh Mandalik Kumar Gaurav Pranay Kargaonkar Abdul Qadir Saify Pavan Kumar Reddy Mukesh Sahu

Transcript of merchant banking revised jan 19th

Page 1: merchant banking revised jan 19th

Presented by Rajesh Mandalik

Kumar GauravPranay Kargaonkar

Abdul Qadir SaifyPavan Kumar Reddy

Mukesh Sahu

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Merchant Banking The Dictionary of Banking and Finance defines a

merchant bank as “ a bank which arranges loans to companies, deals in international finance, buys and sells shares and launches new companies on the stock exchange, but does not provide normal banking services to the general public ”.

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Bird’s eye view of Merchant Banking :

Merchant Banking is a fee-based service.It arranges funds rather than providing them.Originally Merchant Banking business was

started in Italy and France.Later on, it came into existence in the U.K.,

and the U.S.A.In India, it has become popular from 1983-84.

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Merchant Banking In India The Grindlays Bank initiated the merchant

banning activity in Indian Capital Market in

1969.

It’s business forms was on the management of

Public Issues and Financial Consultancy.

City Bank introduced its merchant banking

division in 1970.

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Functions of Merchant Banking

Corporate Counseling

Portfolio Management

Venture Capital Financing

Mergers and Amalgamations

Project Counseling

Underwriting

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Functions of Merchant Banking

Export Financing for capital goods

Hire purchasing

Equipment leasing

Pre-investment Studies

Valuation of assets

Financial management

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Contd....

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Private Investment Bankers

Lehman BrothersMerrill Lynch etc.

Bought loans that fall outside the specs of agencies.

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Merchant Banking Services

->Management of Public Offers of Equity and debt

Instruments.

->Rights issues.

->Buyback Offers.Etc.

Advisory and transaction Services in

->Project Financing.

->Syndicated loans.

->Private Equity/Venture Capital.

->Business Advisory. Etc.

Non-fund Based

Core Business Portfolio

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Core Business Portfolio

Fund Base

->Underwriting.->Market making.

->Bought Out Deals.->Trading in Equities, bonds

and derivatives.

Allied Businesses

->Asset Management services.--Mutual Funds.

--Portfolio Management--Venture capital etc.

->Secondary Market Services.--Brooking

--Equity Research.

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. Securities and Exchange Board of India (SEBI) has divided merchant bankers into four categories, which are as follows: -

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SBI Capital Markets Ltd.

Kotak Mahindra Capital Company.

JM Morgan Stanley Ltd.

DSP Merrill Lynch Ltd.

ICICI Securities Ltd.

IDBI Capital Markets Ltd..

Enam Financial Consultants Ltd.

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Kotak Mahindra Capital Company Ltd.

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Objective

Offers a wide suite of capital market and advisory solutions to clients covering leading domestic and multinational corporations, banks, financial institutions and government companies across major industry sectors.

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India's premier Investment Bank .A subsidiary of Kotak Mahindra Bank Ltd.Reconstitution from a private company to a public

limited company effective from June 13, 2003. Acts as the lead manager to several (IPO's) and helps

its clients in accessing the public and private equity markets.

KIB provides high quality financial advisory services, encompassing the following business areas of operations:

Mergers & Acquisitions Advisory. Raising capital from Equity and Debt Capital Markets. Raising capital from Financial Sponsors. Infrastructure Financing Advisory. Structured Finance Advisory.

Brief Outline

India's premier Investment Bank .A subsidiary of Kotak Mahindra Bank Ltd.Reconstitution from a private company to a public limited company effective from June 13, 2003. Acts as the lead manager to several (IPO's) and helps its clients in accessing the public and private equity markets.

KIB provides high quality financial advisory services, encompassing the following business areas of operations: Mergers & Acquisitions Advisory. Raising capital from Equity and Debt Capital Markets. Raising capital from Financial Sponsors. Infrastructure Financing Advisory. Structured Finance Advisory.

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Awards

Best Investment Bank in India by Finance Asia for 2008, 2007 and 2006.The Best Equity House in India by Asia money in 2008.

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ICICIICICI Securities is a SEBI registered

Category I Merchant Banker and a pioneer of numerous innovative practices in Indian Investment banking space.

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Merchant banking

Corporate finance

Equity capital market

Advisory services

ICICI SECURITIES LTD.

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Equity Capital Market practice comprises:-

IPO Rights Convertible Offerings Qualified Institutional Placement (QIP) Private Placement International offerings.

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Advisory services comprises:- Mergers and Acquisitions (M&A) Private Equity Infrastructure Advisory Corporate Restructuring Joint Ventures.

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MERGERS AND AQUISTIONSICICI Securities was amongst the first Indian

investment banks to form a dedicated M&A practice and continues to be a leader by providing innovative and customised solutions to achieve the varied objectives of clients.

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Private equity ICICI help companies to raise capital during the

seed, growth and expansion phases as well as acquisition financing, structuring the deal to maximize value for all its stakeholders.

industry knowledge across multiple sectors, wide-ranging deal structuring capabilities and thorough grasp of the regulatory environment make us the 'banker of choice', for companies and private equity funds alike.

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It has offered superior services across-the-spectrum corporate finance activities in sectors as diverse as:-

IT Media Telecom Pharma Banking Infrastructure

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Private equity

financing

Secondary sale

transactions

Pre IPO deals

ICICI advice on a wide variety of products

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JM Morgan StanleyEstablished in 1935Morgan Stanley operated two joint ventures with JM

Financial Group, under the name of JM Morgan Stanley.

Global offices are in Americas, Asia pacific, Europe, Africa

In India its branches are in Mumbai and west India.

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Services by STANLEY:-

Brokerage SolutionsAdvisory SolutionsLife Cycle SolutionsProvides customized servicesLast September it offers private wealth management

services some of the investments products are stocks, bonds,

mutual funds, insurance, annuities etc.

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JM Morgan Stanley Investment Banking Industry Coverage

Basic Materials ,consumer products, communications, energy, financial institution, financial sponsors, healthcare, real estate, retail, technology, transportation

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IDBI project advisory services broadly includes:

Overview of the promoting company .Review of the Project Structure and Project

Costs including various assumptions.  Capital Structuring .Real Estate Advisory. Identification and evaluation of various

sources of finance .Financial modelling .Risk Analysis and Allocation .Development of a Security Package .

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Strategic planningBusiness and Strategic Planning. Business Restructuring .Entry Strategy .Policy Advisory. Organisation Restructuring .Bid Process Management .Process Consulting .

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Financial planningBusiness Valuation .Financial & Commercial Due Diligence .Merchant Financial Appraisal .Joint Venture & Contract .Bid Process Management .Disinvestments .Infrastructure Advisory .Financial / Debt Restructuring .Structured Finance & Securitisation .

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CCP - 504 (B). 81 35

Quiz

1. Which bank has initiated merchant banking

activity in India.

A) ICICI Bank

B) Grindlays Bank

C) Canara Bank

D) None

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CCP - 504 (B). 81 36

2. Which is the first Indian Bank to start its merchant banking activity in India?

A) State Bank of India

B) Hongkong Bank

C) Bank of India

D) Canara bank

Quiz

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CCP - 504 (B). 81 37

3. Which commission stressed the need for merchant banking activity in India?

a) Banking Commission b) RBI committee c) Chore Committee d) None

Quiz

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