Introduction (Conceptual Framework)

INTRODUCTION

Original Definition: A Merchant Bank is a British term for a bank providing various
financial services such as accepting bills arising out of trade, providing advice on
acquisitions, mergers, foreign exchange, underwriting new issues, and portfolio
management.
The Focus Definition: A Merchant Bank can be generally described as a financial services
company with a private equity investment arm offering investment banking and ancillary
services as well. Because a merchant bank acts not only as an advisor and broker but also
as a principal, a merchant bank has a longer term approach than a typical investment bank
and is highly concerned with the viability of each investment opportunity and providing
the right advice for a strong partnership with each client company.
In banking, a merchant bank is a traditional term for an Investment Bank. It can also be
used to describe the private equity activities of banking. This article is about the history of
banking as developed by merchants, from the Middle Ages onwards.
Amidst the swift changes sweeping the financial world, Merchant Banking has emerged as
an indispensable financial advisory package. Merchant banking is a service-oriented
function that transfers capital from those who own to those who can use it. They try to
identify the needs of the investors & corporate sector & advice entrepreneurs what to do to
be successful.
The merchant banking has been defined as to what a merchant banker does. A merchant
Banker has been defined by Securities Exchange Board Of India (Merchant Banker) rules,
1992, as “Any person who is engaged in the business of issue management either by
making arrangements regarding selling, buying or subscribing to securities or acting as
manager, consultant, advisor or rendering corporate advisory services in relation to such
issue managemen

MERCHANT BANKING HISTORY

In late 17th and early 18th century Europe, the largest companies of the world was merchant
adventurers. Supported by wealthy groups of people and a network of overseas trading posts, the
collected large amounts of money to finance trade across parts of the world. For example, The East
India Trading Company secured a Royal Warrant from England, providing the firm with official
rights to lucrative trading activities in India. This company was the forerunner in developing the
crown jewel of the English Empire. The English colony was started by what we would today call
merchant bankers, because of the firm's involvement in financing, negotiating, and implementing
trade transactions. The colonies of other European countries were started in the same manner. For
example, the Dutch merchant adventurers were active in what are now Indonesia; the French and
Portuguese acted similarly in their respective colonies. The American colonies also represent the
product of merchant banking, as evidenced by the activities of the famous Hudson Bay Company.
One does not typically look at these countries' economic development as having been fueled by
merchant bank adventurers. However, the colonies and their progress stem from the business of
merchant banks, according to today's accepted sense of the word. Merchant banks, now so called,
are in fact the original "banks". These were invented in the middle Ages by Italian grain merchants.
As the Lombardy merchants and bankers grew in stature on the back of the Lombard plains cereal
crops many of the displaced Jews who had fled persecution after 613 entered the trade. They
brought with them to the grain trade ancient practices that had grown to normalcy in the middle
and far east, along the Silk Road, for the finance of long distance goods trades.

The Jews could not hold land in Italy, so they entered the great trading piazzas and halls of
Lombardy, along side the local traders, and set up their benches to trade in crops. They had one
great advantage over the locals.

Christians were strictly forbidden the sin of usury. The Jewish newcomers, on the other hand, could
lend to farmers against crops in the field, a high-risk loan at what would have been considered
usurious rates by the Church, but did not bind the Jews. In this way they could secure the grain sale
rights against the eventual harvest. They then began to advance against the delivery of grain shipped
to distant ports. In both cases they made their profit from the present discount against the future
price. This two-handed trade was time consuming and soon there arose a class of merchants, who
were trading grain debt instead of grain.

TRADATIONAL MERCHANT BANKING

Merchant Banking, as the term has evolved in Europe from the 18th century to today,
pertained to an individual or a banking house whose primary function was to facilitate the
business process between a product and the financial requirements for its development.
Merchant banking services span from the earliest negotiations from a transaction to its
actual consummation between buyer and seller.

In particular, the merchant banker acted as a capital sources whose primary activity was
directed towards a commodity trader/cargo owner who was involved in the buying, selling,
and shipping of goods. The role of the merchant banker, who had the expertise to
understand a particular transaction, was to arrange the necessary capital and ensure that the
transaction would ultimately produce "collectable" profits. Often, the merchant banker also
became involved in the actual negotiations between a buyer and seller in a transaction.

MODERN MERCHANT BANKING

During the 20th century, however, European merchant banks expanded their services. They
became increasingly involved in the actual running of the business for which the
transaction was conducted. Today, merchant banks actually own and run businesses for
their own account, and that of others.

Since the 18th century, the term merchant banker has, therefore, been considerably
broadened to include a composite of modern day skills. These skills include those inherent
in an entrepreneur, a management advisor, a commercial and/or investment banker plus
that of a transaction broker. Today a merchant banker is who has the ability to merchandise
-- that is, create or expands a need -- and fulfill capital requirements. The modern European
merchant bank, in many ways, reflects the early activities and breadth of services of the
colonial trading companies.

Most companies that come to a U.S. merchant bank are looking to increase their
financial stability or satisfy a particular, immediate capital need.

Professional merchant bankers must have: 1) an understanding of the product, its industry
and operational management; 2) an ability to raise capital which might or might not be
one's own (originally merchant bankers supplied their own capital and thereby took an
equity interest in the transaction); 3) and most importantly, effective skills in concluding a
transaction - the actual sale of the product and the collection of profit. Some people might
question whether or not there are many individuals or organizations that have the abilities
to fulfill all three areas of expertise.

Who are merchant bankers ?

-Merchant banks are private financial institution.

-Their primary sources of income are PIPE (Private Investment In Public Entities)
financings and international trade.

-Their secondary income sources are consulting, Mergers & Acquisitions help and
financial market speculation.
-Because they do not invest against collateral, they take far greater risks than traditional
banks.

-Because they are private, do not take money from the public and are international in scope,
they are not regulated.

-Anyone considering dealing with any merchant bank should investigate the bank and its
managers before seeking their help.

-The reason that businesses should develop a working relationship with a merchant bank
is that they have more money than venture capitalists. Their advice tends to be more
pragmatic than venture capitalists.

Functions of Merchant Bankers:

 Consulting advice on going public and international business.
 Advice and help in taking your company public. If they are unwilling to supply
Investment Banking bridge loans, they have a low cost strategy for taking your
company public.
 They do PIPE (Private Investment in Public Equities) financings.
 They can advise or help with a company’s M&A strategy.
 They are essential advisors for companies seeking to become multinational
corporations

SIGNIFICANCE OF THE STUDY

 It would help us to develop the ability to study the functioning of Merchant Banking
in India & learn & apply multidisciplinary concepts, tools & techniques to solve
vital problems.
 It familiarizes with the various services provided by Merchant Bankers.

 They would help us to draw comparison between public & private sector companies
engaged in Merchant Banking activities.

 Based upon the comparison, it would help us to determine which sector has more
growth potential & where should one invest his/her funds to maximize the return at
minimum risk.
 MERCHANT BANKING
IN INDIA

MERCHANT BANKING IN INDIA

In India Merchant Banking activities started from the year 1967, following the footsteps of
similar activities in UK & USA. Currently Merchant Banking activity has mushroomed in
the Indian capital market with both public & private sector settings up their respective
merchant Banking divisions. Currently, the total no. of merchant bankers in India are
approx. 1450 with more than 930 registered with SEBI. The SEBI authorized Merchant
Bankers Include merchant Banking divisions of All India Financial Institutions,
nationalized & foreign banks, subsidies of the commercial banks, private merchant banks
engaged in stock broking, underwriting activities & financial consultancy & investment
advisory service firms.

 Grindlays Banks – 1967

 Citi banks – 1970

 SBI – 1973

 ICICI - 1974

Merchant banking in India - an overview

Companies raise capital by issuing securities in the market. Merchant bankers act as
intermediaries between the issuers of capital and the ultimate investors who purchase these
securities.

Merchant banking… is the financial intermediation that matches the entities that need
capital and those that have capital. It is a function that facilitates the low of capital in the
market.

Merchant banker registered with SEBI:

Public Sector: - Commercial banks (24), Financial Institutions (6), State Institutions (4)

Private sector: - International bankers (10), Banks (10), finance & investment (231)

The following comprise the main functions of a merchant

banker in India:
Management of debt and equity offerings- This forms the main function of the
merchant banker. He assists the companies in raising funds from the market. The main areas of
work in this regard include: instrument designing, pricing the issue, registration of the offer
document, underwriting support, and marketing of the issue, allotment and refund, listing on
stock exchanges.

Placement and distribution- The merchant banker helps in distributing various securities
like equity shares, debt instruments, mutual fund products, fixed deposits, insurance products,
commercial paper to name a few. The distribution network of the merchant banker can be classified
as institutional and retail in nature. The institutional network consists of mutual funds, foreign
institutional investors, private equity funds, pension funds, financial institutions etc. The size of
such a network represents the wholesale reach of the merchant banker. The retail network depends
on networking with investors.

Issue Management:
Management of issue involves marketing of corporate securities viz. equity shares, preference
shares and debentures or bonds by offering them to public. Merchant banks act as an intermediary
whose main job is to transfer capital from those who own it to those who need it. After taking action
as per SEBI guidelines, the merchant banker arranges a meeting with company representatives and
advertising agents to finalize
Arrangements relating to date of opening and closing of issue, registration of prospectus, launching
publicity campaign and fixing date of board meeting to approve and sign prospectus and pass the
necessary resolutions. Pricing of issues is done by the companies in consultant with the merchant
bankers.

Underwriting of Public Issue: Underwriting is a guarantee given by the underwriter that

in the event of under subscription, the amount underwritten would be subscribed by him.
Banks/Merchant banking subsidiaries cannot underwrite more than 15% of any issue.

Financial structuring includes determining the right debt-equity ratio and gearing ratio for
the client; the appropriate capital structure theory is also framed. Merchant bankers also explore
the refinancing alternatives of the client, and evaluate cheaper sources of funds. Another area of
advice is rehabilitation and turnaround management. In case of sick units, merchant bankers may
design a revival package in coordination with banks and financial institutions. Risk management is
another area where advice from a merchant banker is sought. He advises the client on different
hedging strategies and suggests the appropriate strategy.

Project Counseling: Project counseling includes preparation of project reports, deciding

upon the financing pattern to finance the cost of the project and appraising the project report with
the financial institutions or banks. It also includes filling up of application forms with relevant
information for obtaining funds from financial
Institutions and obtaining government approval.
Loan syndication- Merchant bankers arrange to tie up loans for their clients. This takes
place in a series of steps. Firstly they analyses the pattern of the client’s cash flows, based on
which the terms of borrowings can be defined. Then the merchant banker prepares a detailed loan
memorandum, which is circulated to various banks and financial institutions and they are invited
to participate in the syndicate.

Providing venture capital and mezzanine financing- Merchant bankers help

companies in obtaining venture capital financing for financing their new and innovative
strategies.

Portfolio Management: Portfolio refers to investment in different kinds of securities such

as shares, debentures or bonds issued by different companies and government securities. Portfolio
management refers to maintaining proper combinations of securities in a manner that they give
maximum return with minimum risk.

Off Shore Finance:

The merchant bankers help their clients in the following areas involving foreign currency.
(a) Long term foreign currency loans
(b) Joint Ventures abroad
(c) Financing exports and imports
(d) Foreign collaboration arrangements

Non-resident Investment:The services of merchant banker includes investment advisory

services to NRI in terms of identification of investment opportunities, selection of securities,
investment management, and operational services like purchase and sale of securities.

Corporate Counseling and advisory services: Corporate counseling covers the

entire field of merchant banking activities viz. project counseling, capital restructuring, public issue
management, loan syndication, working capital, fixed deposit, lease financing acceptance credit,
etc. Merchant bankers also offer customized solutions to their client’s financial problems.

Developments in Merchant banking

Establishments In India
  Setting up of banks Subsidiaries:

In order to meet the growing demand for broad-based finacial services from the corporate
sector more effectively, the merchant banking division of the nationalise banks have stated
forming independent subsidiaries. These subsidiaries offer more specialised services with
proffecinal expertise & skills . SBI capital market ltd. Was incorporated as the first such
subsidiary of sbi on 2 july, 1986. Then CAN BANK finacial services ltd was set up as
wholly owned subsidiary of canra bank in 1987. PNB Capital Market was promoted by
PNB during Mid 1988. Many more subsidiaries are being set up by another nationalise
banks.

 Reorganisation of private Firms:

Expecting tough Competition from growing number of merchant banking subsidiary of

nationalised banks, private merchant bankers have also started reorganising their activities
e.g., J.M finacial & investment consultancy ltd., 20th century finance corporation ltd., LKP
merchant finacing ltd are some of the private sector firms of merchant bankers who have
taken steps to reorganise their activities.

 Establishment of SUA:

In order to educate and protect the interest of investor , to provide information about new
issues of capital market, to evolve a code of conduct for underwriters & to render legal &
other services to members & public, the STOCKBROKER UNDERWRITER
ASSOCIATION(SUA) was esteblished in 1984.

 Discount & Finance House of India(DFHI)

DFHI was incorporated as a company under the company act 1956 with an authorised &
paid up capital of rs 100 crore. Out of this rs 51 crores has been contributed by RBI, rs 16
crores bt finacial institions & 33 crores by public sector banks. It would also have line of
credit from public sector banks , refinance facility from the RBI in order to meet the
working capital requirement.DFHI aims at providing liquidity in money makket as it deals
mainly in commercial bills.

 Credit Rating Information Services of India Ltd.(CRISIL)

CRISIL has been set up in 1987 to provide help to investors, merchant bankers,
underwriters, brokers, banks & finacial institutions etc. CRISIL ratees various types of
instruments such as debt, Equity, & Fixed return security offered to the public. It help the
investor in taking investment decisions.

 Stock-Holding Corporation of India Ltd. (SHC)

SHC was set up in 1986 by the all indian financial institutions to take care of safe custody,
delivery of shares & collection of sale proceeds of the securities. The setting up of SHC is
bound to affect the capital market ain future,

Registration of merchant bankers in India

Registration with SEBI is mandatory to carry out the business of merchant banking in India.
An applicant should comply with the following norms:
  The applicant should be a body corporate
 The applicant should not carry on any business other than those connected with the
securities market
 The applicant should have necessary infrastructure like office space, equipment,
manpower etc.
 The applicant must have at least two employees with prior experience in merchant
banking
Any associate company, group company, subsidiary or interconnected company of
the applicant should not have been a registered merchant banker
 The applicant should not have been involved in any securities scam or proved guilt
for any offence

SEBI HAS DIVIDED MERCHANT BANKER’S IN

FOUR CATEGORIES, WHICH ARE AS FOLLOW:-
CATEGORIES ACTIVITIES NETWORTH
Category I To carry on the activities of issue mgt & act as RS 1 Crore
advisor, consultant, manager, underwriter,
portfolio management.

Category II To act as advisor, consultant , co-manager, Rs 50 lakh

Underwriter, portfolio management.

Category III To act as advisor, underwriter or consultant Rs 20 lakh

to an issue

Category IV To act only as advisor& consultant to an issue Nil

Procedure for getting registration:

An application should be submitted to SEBI in Form A of the SEBI (Merchant Bankers)

Regulations, 1992. SEBI shall consider the application and on being satisfied, issues a
Certificate of registration in Form B of the SEBI (Merchant Bankers) Regulations, 1992.
Registration fee payable to SEBI:

Rs. 5 lakhs which should be paid within 15 days of date of receipt of intimation regarding
Grant of certificate. Validity period of certificate of registration is three years from the
Date of issue. Three months before the expiry period, an application along with renewal
Fee of 2.5 lakhs should be submitted to SEBI in Form A of the SEBI (Merchant Bankers)
Regulations, 1992. SEBI shall consider the application and on being satisfied renew
Certificate of registration for a further period of 3 years.

Leading Merchant Bankers in India

 In Public Sector: SBI Capital Markets Ltd., Merchant Banking

Divisions of IDBI & IFCI, PNB Capital Services Ltd., Bank of

Maharashtra, etc.

 In Private Sector: ABN AMRO, ICICI Bank Ltd, Axis Bank Ltd.,

Kotak Mahindra Capital Co., Bajaj Capital, Reliance Security Ltd., Yes

bankLtd, Tata capital market ltd., JM Financial Co. and DCM Financial

Services Ltd etc.

 Foreign Players: Goldman SACH (India) Security Pvt. Ltd., Morgan

Stanley Indian co. Pvt. Ltd., Barclays Security Indian Pvt. Ltd., Bank of

America, Deutsche Bank, Citi Group Global Market Indian Pvt.

Ltd., Fedex Security Ltd.,

Note: Please find the List of all registered Merchant Bankers with SEBI at the end in Appendix-1
 Role in India

Merchant Banking:
The merchant banker are those financial intermediary involved with the activity of
transferring capital funds to those borrowers who are interested in borrowing. The activities
of the merchant banking in India are very vast in nature of which includes the following

1. The management of the customers securities

2. The management of the portfolio
3. The management of projects and counseling as well as appraisal.
4. The management of underwriting of shares and debentures.
5. The circumvention of the syndication of loans.
6. The management of the interest and dividend etc.

Factors responsible for changes:

Globalization of Indian Economy has made the whole economy open, which has more
multinational player in the era of the financial services? This has resulted in to the
emergence of the global investment in financial sector. Govt. has now open up the doors
of investment especially in the area of banks and insurance, which leads to competitive
environment for the present players. Now they have to bring something new which is
efficient and best services to live in the competitive environment. Competition arising out
of Private Company participation is due to liberalization of the economy.

Scope for growth of Merchant Banking in India

As planning and industrial policy of the country envisaged the setting of up of new
industries and technology, greater financial sophistication and financial services are
required. There is a well proven link between economic growth and financial technology.
Economic development requires specialist financial skills: savings banks to marshal
individual savings; finance companies for consumer lending and mortgage finance;
insurance companies for life and property cover; agricultural banks for rural development;
and a range of specialized government or government sponsored institutions. As new units
have been set up and business is expanding, they require additional financial services. A
public equity or debt issue is the logical source of fund in this situation and merchant banks
can tap this opportunity of growth.

The areas of great scope could be,

 Growth of Primary market:

If the primary market grows and number of issues increases, the scope of merchant banking
will be enhanced.

 Entry of Foreign Investors:

Now India capital market directly taps foreign capital through euro issues.FDI is increased
in capital market. So Merchant bankers are required to advice them for their investment in
India. The increasing number of joint ventures also requires expert services of Merchant
Bankers. If more and more NRIs participate in capital market, there will be great demand
for merchant banker services.

 Changing policy of Financial Institutions:

Now the lending policies of financial institutions are based on project orientation, so the
merchant banker services will be needed by corporate enterprise to provide expert
guidance.
 Development of debt markets:
If the debt market is enhanced, there will be tremendous scope for Merchant bankers. Now
NSE and OTCEI are planned to raise their fund through debt instruments.

 Corporate restructuring:
Due to liberalization and globalization Companies are facing lot of competition. In order
to compete, they have to go for restructuring, merger, acquisitions or disinvestments. They
may offer good opportunities to merchant bankers

The scope could be extended to:-

1. Advising the company on designing of its Capital Structure.
2. Advising the company on the instrument to be offered to the public.
3. Pricing of the instrument.
4. Advising the company on Legal/ regulatory matters and interaction with SEBI/ ROC/
Stock
5. Exchanges and other regulatory authorities.
6. Assisting the company in marketing the issue.
7. In channelizing the financial surplus of the general public into productive investment avenues.
8. To coordinate the activities of various intermediaries to the share issue such as the registrar,
Bankers, advertising agency, printers, underwriters, brokers etc.
9. To ensure the compliance with rules and regulations governing the securities market.

THE FACTORS ON WHICH GROWTH OF

MERCHANT BANKING DEPENDS:
 Planning and industrial policy of the country i.e. India in this case

 Prevailing Economic condition of the country.

 Regulatory system of the market and economy prevailing in India.

 Confidence of the people, traders, buyers, marketers, business houses, financial

institutions etc.

 The economic environment of the outside world.

 Competition among the existing players and the upcoming entrants.

 Problems of Merchant Banking:

Restriction of merchant banking activities:

SEBI guidelines have authorized merchant bankers to undertake issue

related activities and made them restrict their activities or think of
separating these activities from present one and float new subsidiary and
enlarge the scope of its activities.
Minimum net worth of Rs.1 crore:

SEBI guidelines stipulate that a minimum net worth of Rs.1 crore for
authorization of merchant bankers.
Non co-operation of issuing companies:

Non co-operation of the issuing companies in timely allotment of securities

and refund of application money is another problem faced by merchant
bankers.
Merchant Banker’s Commission:

 Maximum :- 0.5%
 Project appraisal fees
 Lead Manager :-
- 0.5% up to Rs.25 crores
- 0.2% more in excess of Rs.25 crores

 Underwriting fees

 Brokerage commission :- 1.5%

 Other expenses :-
- Advertising
- Printing
- Registrar’s expenses
- Stamp duty
In spite of problems popping up, merchant banking in India has vast scope to develop
because of lot of domestic as well as foreign businesses booming here. Indian economy
provides an amicable environment for these firms to set up, flourish and expand here.
Difference Between Commercial Banking & Merchant
Banking:

 COMMERCIAL BANKING

 Deals with Debt & Debt related finance.

 Asset oriented.
 Generally avoid risks.

 MERCHANT BANKING

 Deals with Equity & Equity related finance.

 Management oriented.
 Willing to accept risks.

Difference Between Investment Banking & Merchant

Banking:

 INVESTMENT BANKING

 Both fee-based and fund-based.

 Commit their own funds.

 MERCHANT BANKING

 Purely fee-based.
 Impossible to stay aloof from international trends.
BRIEF ANALYSIS OF SOME MERCHANT
BANKS OF INDIA

 SBI Bank of India

 ICICI Bank Ltd.

 Punjab National Bank

 Bank of Baroda

 Union Bank of India

 Kotak Mahindra

 Canara Bank

 IDBI BANK
SBI Merchant Banking Group is strongly positioned to offer perfect financial solutions to your
business. We specialize in the arrangement of various forms of Foreign Currency Credits for
Corporate.

State Bank of India is the nation's largest bank. Tracing its roots back some 200 years to the British
East India Company (and initially established as the Bank of Calcutta in 1806), the bank operates
more than 13,500 branches and over 5,000 ATMs within India, where it also owns majority stakes
in seven associate banks. State Bank of India has more than 50 offices in nearly 35 other countries,
including multiple locations in the US (California), Canada, and Nigeria. The bank has other units
devoted to capital markets, fund management, factoring and commercial services, and brokerage
services. The Reserve Bank of India owns about 60% of State Bank of India.

SBI being an Indian entity has no India exposure ceiling. Our Primary focus is On Indian Clients.
SBI’s seasoned Team of professionals provides you with Insightful credit Information and helps
you Maximize the Value from the transaction.

OUR PRODUCTS AND SERVICES

 Arranging External Commercial Borrowings (ECB)

 Arranging and participating in international loan syndication
 Loans backed by Export Credit Agencies
 Foreign currency loans under the FCNR (B) scheme
 Import Finance for Indian corporate
 SBI CAPITAL MARKETS LIMITED (SBICAPS) is India's leading investment
bank and project advisor, assisting domestic company’s fund-mobilization efforts for last many
years.

We began operations in August 1986 as a wholly owned subsidiary of the State Bank of India,
which is the largest commercial bank in India. In January 1997, fresh equity shares were issued to
Asian Development Bank (ADB) and ADB now holds 13.84% stake in the equity of SBICAPS.
The distinguished parentage (with a 86.16% stake) together with the long standing association of
an internationally renowned financial institution like the Asian Development Bank further
enhances our image as a truly 'World Class Investment Bank'.

Our Mission - To provide Credible, Professional and Customer Focused world-class investment
banking services.

Our Vision - To be the best India based Investment Bank.

SBI Group:

 The largest commercial bank group in India

 Position in the domestic banking sector as on 31 March 2017:
 15.44% of the aggregate deposits.
 15.28 % of total advances.
 The only Indian Bank to find a place in the Fortune Global 500 List.
 First Indian Bank to take up merchant banking in 1986.

SBI Capital Markets Limited:

 No. 1 in Asia – Pacific for Project Advisory. Rating by Thomson Project Finance
International.
 No. 1 in IPO’s, managed 700+ issues (since 1989 – source Prime Database).
 The only Indian Merchant Banker in the Global 10, Thomson Project Finance
International 2007.
 Pioneer in Privatization.

Subsidiary:-

 SBICAPS Ventures Ltd.

 SBICAP Securities Ltd.
 SBICAPS (UK) Ltd.
 SBICAP Trustee Company Ltd.
Associates Bank:-
State Bank of State Bank of SBI Factors & SBI Commercial
Bikaner & Saurashtra Comm. (California) Bank of India
Jaipur Services Ltd. LLC

State Bank of State Bank of SBI Funds SBI

Hyderabad Travancore Management International
(P) Ltd. (Mauritius)
Ltd.

State Bank of SBI Capital SBI DFHI Ltd. Indo-Nigerian

Indore Markets Ltd. Merchant
Bank

State Bank of SBICI Bank SBI Life Nepal SBI

Mysore Ltd. Insurance Co. Bank Limited
Ltd

Key Personnel:-
Board of Directors Committee of Audit Management Team
Directors Committee

Shri O. P. Bhatt Shri R. Sridharan Shri D. Shri S. Vishvanathan

(Chairman) (Chairman) Sundaram (MD & CEO )
(Chairman)
Dr. R. H. Patil Dr. R. H. Patil Shri R. Shri M. K. Nag
Sridharan (Executive Vice
President)

Shri R. Sridharan Shri S. Vishvanathan Dr R. H. Patil

(MD & CEO)
Shri Bansi S. Mehta
Smt. Bharati Rao
Shri D. Sundaram
Shri Ajay Sagar
Dr. Swati A. Piramal
Shri S. Vishvanathan
(MD & CEO)
 Promoters’ Share: - Performance:-

Awards:-
 Asia Pacific Bank of the Year Award 2009 for Leadership in Project Finance by
Thomson Reuters (pfi)
 India Loan House 2009 for Leadership in Loan Syndication by Thomson Reuters
(ifr Asia)
 Asia Pacific Oil and Gas Deal of the Year 2009 for Cairn India by Thomson
Reuters (pfi)
 African Power Deal of the Year 2009 for Morupule B by Thomson Reuters (pfi)
 Indian Power Deal of the Year 2009 for Sasan by Euromoney
 Indian Upstream Oil & Gas Deal of the Year 2009 for Cairn India by Euromoney
 Indian Road Deal of the year 2009 for Yamuna expressway by Euromoney
 Indian Telecom Deal of the Year 2009 for Aircel by Euromoney
 SAFA Best Presented Accounts Award 2017
 Award for Excellence in Financial Reporting
SERVICE’S:-
 Project Advisory & Structured Finance

SBICAP has built a formidable presence in the area of Project Finance Advisory and
Funds Syndication with several prestigious mandates in almost every sector of the
industry to its credit.
Our product portfolio includes:
 Project Appraisal
 Structured Finance and Syndication
 Infrastructure Project Advisory
 Securitisation
 Debt & Equity Syndication

 Capital Markets

Capital Markets Group handles transactions in the capital markets space across multiple
instrument structures.
Our product and solutions bouquet includes:
 Managing Initial Public Offerings and Follow-on Public offerings and Offers-for-
Sale
 Managing Rights Offering, be it the traditional or the structured formats
 Qualified Institutional Placements
 Open offers, Buyback and Delisting of securities
 Offerings of convertible securities
 Public offering of Corporate structured bonds
 Arranging Private Equity to include growth capital, pre-IPO convertibles, private
investments in public equity (PIPES), mezzanine debt and equity, and equity
offerings completed as a private placement.
 Private placement of bonds
 Capital restructuring advisory services
 Advisory and arrangement services for products such as AIM Listing, Indian
Depository Receipts, ADR/GDR and other off-shore equity or bond listing
options

 M&A and Advisory

The M & A product portfolio includes:
 Mergers & Acquisitions
 Private Equity
 Foreign Currency Convertible Bonds (FCCB)
 Corporate Advisory
Employees:83,058
Employee growth: 37.2%

You see, ICICI Bank is India's #2 bank (after State Bank of India), with more than 600
branches and 2,200 ATMs nationwide. ICICI's retail banking group offers lending and
deposit services to small businesses and individuals. Larger businesses are served by the
corporate banking group, which offers finance services and treasury products. ICICI's rural
and government banking unit offers micro-loans and agricultural banking. Foreign
operations, as well as services related to international trade finance and expatriate Indians,
fall under the international banking group. Other ICICI offerings include online banking,
asset management, and insurance.

Key numbers for fiscal year ending March, 2017:

Sale: $5,796.3M
One year growth: 99.1%
Net income: $524.1M
Income growth: 167.4%

ICICI Advice on Wide Varity of Product:

 Private Equity Financing

 Secondary sale transactions
 pre IPO deals
ICICI Securities Ltd is the largest equity house in the country providing end-to-end
solutions (including web-based services) through the largest non-banking distribution
channel so as to fulfil all the diverse needs of retail and corporate customers. ICICI
Securities (I-Sec) has a dominant position in its core segments of its operations -
Corporate Finance including Equity Capital Markets Advisory Services, Institutional
Equities, Retail and Financial Product Distribution.
ICICI Securities Inc., the step-down wholly owned US subsidiary of the company is a
member of the National Association of Securities Dealers, Inc. (NASD). As a result of
this membership, ICICI Securities Inc. can engage in permitted activities in the U.S.
securities markets. These activities include Dealing in Securities and Corporate Advisory
Services in the United States and providing research and investment advice to US
investors.
is a SEBI Registered CAT-1 Merchant banker. ICICI Securities Inc. is also registered
with the Financial Services Authority, UK (FSA) and the Monetary Authority of
Singapore (MAS).

Board of Directors:-
ICICI Securities Limited. ICICI Securities Holding Inc. ICICI Securities, Inc.

Ms. Chanda Kochhar, (Chairperson) Ms. Anup Bagchi, Mr. Anup Bagchi,
(Chairman) (Chairman)

Mr. Ketan Patel Mr. A Murugappan Mr. A Murugappan

Mr. Narendra Murkumbi Mr. Charanjit Attra Mr. Charanjit Attra

Mr. Uday Chitale Mr. Subir Saha Mr. Subir Saha

Mr. Pravir Vohra Mr. Gopakumar P.,

(President)

Mr. Sonjoy Chatterjee

Ms. Madhabi Puri-Buch, (Managing

Director & CEO)

Mr. A. Murugappan,
(Executive Director)
Mr. Anup Bagchi,
(Executive Director)
 Awards & Recognition

Institutional
 ICICI Securities is awarded as the Best Investment Bank 2017 by Global Finance
Magazine
 The Corporate Finance group also was awarded a runner-up Best Merchant
Banker by Outlook Money in 2007.
 ICICI Securities (I-Sec) topped the Prime Database League Tables 2007 for
money raised through IPOs/FPOs.
 The equities team was adjudged the 'Best Indian Brokerage House-2003' by
Asiamoney.

Retail
 ICICIdirect wins the prestigious Outlook Money - India's Best e-Brokerage House
for 2009.
 ICICIdirect, the neighborhood financial superstore won the prestigious Franchise
India `Service Retailer of the Year 2017 award.
 ICICIdirect wins the prestigious Outlook Money - India's Best e-Brokerage House
for 2017.
 ICICIdirect been winning the prestigious Outlook Money - India's Best e-
Brokerage House for 2003-2004, 2004-2005, 2006-2007 and 2007-2017.
 ICICIdirect has also won the CNBC AWAAZ Consumer Award for the Most
Preferred Brand of Financial Advisory Services.
 Best Broker - Web 18 Genius of the Web Awards 2007
 Franchisor of the year award 2009
 Retail concept of the year awards 2009

Technology
  IDG India's CIO magazine has recognized ICICI Securities as a recipient of 2009
CIO 100 award
 Indian Bank's Association Business Technology Awards for Best Online Trading
Platform in 2006 and 2007

Punjab National Bank (PNB) is one of India's largest nationalized banks with some 4,500
branches or service counters. The financial institution offers services in personal and
corporate banking, including industrial, agricultural, and export finance, as well as
international banking. Its personal lending services include loans for housing, autos, and
education. PNB's diverse client list includes Indian conglomerates, small and mid-sized
businesses, non-resident Indians, and multinational companies. The bank was established
in Lahore in 1895 -- before the country was partitioned into India and Pakistan in 1947.

Key numbers for fiscal year ending 2017:

Sale: $2,315.0M
Net income: $322.1M

PNB's Financial Numbers

 Sales $2.32 bil

 Profits $.28 bil
 Assets $24.12 bil
 Market Value $2.79 bil
 Employees 58,300
Bank of Baroda (BOB) was established on 20th July, 1908 in the princely state of Baroda
by the great visionary, Sir Sayajirao Gaekwad III. The founder strongly believed that, "a
bank of this nature would prove to be a beneficial agency for lending, transmission and
deposit of money and a powerful factor in the development of art, industries and commerce
of the state as also of adjoining territories". Unlike other state-owned bank, BOB could
maintain its unique identity and established a strong national presence even before
independence, to all corners of the country.
The Bank was led by eminent personalities and great bankers like Shri V.D. Thakersey,
Walchand Hirachand, R.D. Birla, N.M. Chokshi, M.G. Parikh and others.
BOB was amongst the first few banks to venture overseas by opening a branch at
Mombassa in 1953. Today it has significant international presence with a network of 72
offices in 25 countries.
Bank of Baroda has 100 years of glorious performance and an uninterrupted profit record,
serving generation after generation around the globe.
BOB Capital Markets Ltd. (BOBCAPS) is a wholly owned subsidiary of Bank of Baroda.
BOBCAPS is one of the Investment Banking Companies in India and is a SEBI registered
Category I Investment Banker. We are shortly commencing Broking/E-broking Business.
BOBCAPS offers the entire spectrum of financial services that includes Initial Public Offerings,
Private Placement of Debt, Corporate Restructuring, Business Valuation, Mergers &
Acquisitions, Project Appraisal and Loan Syndication. BOBCAPS also undertakes advisory
services on Securitisation and Structuring of Debts.

Singular Strengths

 Patronage of Bank of Baroda

 Excellent association with Banks and Financial Institutions
 Good relationship with fellow market intermediaries
 Large client base consisting of blue chip and midcap companies
 Good rapport with regulatory authorities

Strengths

 Patronage of over 101 years old "Bank of Baroda" having more than 3000 branches
across India and 70 branches overseas.
 Excellent rapport with the concerned regulatory authorities.
 Good liaison with Banks and Financial Institutions.
 Strong relationship with fellow Market Intermediaries.
 Strong pool of clients consisting of Blue chip and mid cap companies.
 Experienced & qualified professionals wholly devoted towards their key areas.

Board of Directors

 Mr. J.S. Arora - Managing Director

 Mr. P.H.Ravi Kumar - Independent Director
 Mr. N.Ramani - Nominee Director
 Mr. Raj Kumar Aggarwal - Independent Director
 Mr. Akshay M. Joshi - Whole Time Director
 Mr. S. Swaminathan - Whole Time Director
SERVICES:-

 Investment Banking
 IPO / Rights Issue / FPO
 Mergers & Acquisition
 Private Placement of Debt / Equity
 Private Equity Advisory
 Corporate Advisory Services
 Project Appraisal / TEV Studies
 Debt Syndication
 Business Valuation

 Retail Broking
 Online Trading
 Call n Trade
 Applying IPOs Online
 Applying MFs Online

 Institutional Broking
 Institutional Equity Broking Services
 Equity Research
 F & O Dealing and Sales

 Mutual Fund Distribution

 BOB Capital Markets Ltd. (BOBCAPS), a wholly owned subsidiary of Bank of Baroda is
into Mutual Fund Distribution and Advisory Services. As a distributor we are empanelled
with 28 SEBI Registered Mutual Funds in India including SBI, UTI, Reliance, HDFC,
Fidelity, and Franklin Templeton.
 PERFORMANCE

Recent Offerings
Business Valuation

Business Valuation for a

Project Appraisal and Valuation
crossover M&A Deal Valuation of shares

Capital Issues - Equity

Lead Manager to the Initial Public Offering Lead Manager to the Lead Manager to the Rights
of Issue Size INR 750 Million Issue Size INR 180 Million

Capital Issues - Debt

Arranged Issue of NCDs on Arranged the Issue of

Private Placement Basis
worth INR 3250 Million
Arranged Issue of NCDs on Private
Placement basis worth INR 500 Million
various Bond series for Tier
I and Tier II capital
requirements aggregating
INR 20 Billion from 2007-
2009

Mergers & Acquisitions

Advisor to the Takeover Deal.

Union Bank of India has been around for more than 88 years. The bank has earned a
reputation for being techno-savvy--more than 600 branches of Bank are networked and
powered with a centralized technology platform, the bank also manages close to 395
networked ATMs.

Union Bank is a Public Sector Unit with 55.43% Share Capital held by the Government of
India. The Bank came out with its Initial Public Offer (IPO) in August 20, 2002 and Follow
on Public Offer in February 2006. Presently 44.57 % of Share Capital is presently held by
Institutions, Individuals and Others.

Board of Directors
 SHRI M.V.NAIR (Chairman & Managing Director)
 Shri S.C.Kalia(Executive Director)
 SHRI S.Raman(Executive Director)
 Dr. Gulfam Mujibi(Part-time non-official Director)
 Shri B.M.Sharma(Chartered Accountant Director)
 SHRI N. SHANKAR (WORKMEN DIRECTOR)
Products and Services

 Personal Banking (Accounts & Deposits,Retail Loans,Cards,Insurance &

Investment,Demat)
 NRI Banking(Remittance, Savings & Deposits, Loan & Services, Payments)
 Corporate Banking(CMS, E-Tax, Insurance, Trade Finance, loans Syndication,
MSME Banking)
 Internet Banking(Account Information,Transfer of Funds/Bills/Limits/Currency.
Financial & Non Financial enquiries)

Award’s:

 The Bank was awarded the Gold Trophy and a certificate in the Elite Class for
Excellence in Marketing & Brand Communication by Association of Business
Communicators of India (ABCI) in March 2010. The award was given away by the
Hon’ble Governor of Maharastra, Shri K.Sankaranarayan.
 The Bank was awarded the prestigious “Skoch Challenger Award” 2009 for
excellence in capacity building through innovative concept of “Village Knowledge
Centre” as part of financial inclusion initiatives. The award was given away by Dr.
C Rangarajan, Economic advisor to the Prime Minister
th
 As part of its global expansion initiatives, the Bank opened its 5 overseas
representative office in London, U.K. in April 2010. The Bank already has 4
representative Offices in Shanghai, Beijing in PRC, Abu Dhabi in UAE and Sydney,
Australia. Besides the Bank has a full fledged overseas branch in Hong Kong. The
Bank is the process of setting up a Rep Office in Toronto, Canada.
 The Kotak Mahindra Group
Kotak Mahindra is one of India's leading financial conglomerates, offering complete
financial solutions that encompass every sphere of life. From commercial banking, to
stock broking, to mutual funds, to life insurance, to investment banking, the group caters
to the financial needs of individuals and corporates.
The group has a net worth of over Rs. 7,100 crore and has a distribution network of
branches, franchisees, representative offices and satellite offices across cities and towns
in India and offices in New York, London, San Francisco, Dubai, Mauritius and
Singapore. The Group services around 6.5 million customer accounts.
Since the inception of the erstwhile Kotak Mahindra Finance Limited in 1985, it has been
a steady and confident journey leading to growth and success.

Kotak Group Products & Services:

Senior Management:

 Mr. Uday S. Kotak (Executive Vice Chairman & Managing Director)

 Mr. Anand Mahindra (Vice-Chairman and Managing Director)
 Mr. C Jayaram (Executive Director)
 Mr. Dipak Gupta (Executive Director)
 Dr. Shankar Acharya (Non-Executive Part-time Chairman)
 Mr. Shivaji Dam (managing director of Kotak Mahindra Old Mutual Life
Insurance Limited)
 Mr. C. Jayaram ( Executive Director)
 Mr. Dipak Gupta ( Executive Director)
 Mr. Cyril Shroff (managing partner of the law firm)
 Kotak Securities
Kotak Securities Ltd. 100 % subsidiary of Kotak Mahindra Bank is one of the oldest and
largest broking firms in the Industry. A subsidiary of Kotak Mahindra bank. Reconstruction
from a private company to a public limited company effective from June 13, 2003. Act as
a lead manager to several (IPO’s) & help in Client in accessing the public & private equity
market.

It is also a depository participant with National Securities Depository Limited (NSDL)

and Central Depository Services Limited (CDSL).
Kotak Securities Limited has Rs. 2300 crore of Assets Under Management (AUM) as of
31st March, 2010.

Large Presence: At present Kotak in 331 cities with 843 offices all over the country.

Services :-
 stock broking through the branch and Internet,
 Investments in IPO,
 Mutual funds
 Portfolio management service,
 Currency Derivatives,
 Insurance.

Accolades :

UTI MF – CNBC TV18 Financial Advisor Awards - Best Performing Equity Broker
(National) for the year 09
Finance Asia Award (2009)-Best Brokerage Firm In India
Best Brokerage Firm in India by Asiamoney in 2017, 2007 & 2006
Best Performing Equity Broker in India – CNBC Financial Advisor Awards 2017
Avaya Customer Responsiveness Awards (2007 & 2006) in Financial Services Sector
The Leading Equity House in India in Thomson Extel Surveys Awards for the year 2007
Euromoney Award (2007 & 2006) - Best Provider of Portfolio Management: Equities
Euromoney Award (2005)-Best Equities House In India
Finance Asia Award (2005)-Best Broker In India
Finance Asia Award (2004)- India's best Equity House
Prime Ranking Award (2003-04)- Largest Distributor of IPO's
CANRA BANK is also one of the leading merchant bankers in India, offering specialize
services to banks, PSUs, and State owned corporation, Local statutory bodies, &
corporate sector.

It is SEBI register with CAT I Merchant banker to carry on issue management (public,
right, private placement), Underwriting Consoltancy, Corporate advisory services.

It have associated with issue ranging from 1 crore to 1500 crore, involving various types
of industries, banks , statutory Bodies etc. & have an edge in handling Private Placement
issue- Both Retail & HNIs.

SPECTROM of Services:-

 Equity Issue (Public/ Right) management.

 Debt Issue management.

 Private Placement

 Project appraisal

 Monitoring agency assignments.

 Agriculture Consultancy Services

 Corporate Advisory Services

 Merger & Acquisition

 Share valuation & Buy back Assignment.

 IPO funding Security Trustee Services.

About

PROMOTERS/ACTIVITY

The Company, a Subsidiary of Canara Bank was incorporated and accredited as a

Primary Dealer (PD) in 1996 in the name of ‘Gilt Securities Trading Corporation
Limited. (GSTCL)’ with a paid-up capital of Rs.100 Crores.
The Primary Dealer activity of the Company was taken over by the parent Bank in
February, 2007 and the Company is focusing on capital market related activities mainly
into equity broking and distribution of Financial Products.
The name of the Company has been changed as ‘Canara Bank Securities Ltd. (CBSL)’
in 2009.
The On Line Trading (OLT) in Equity and FNO is a product added by CBSL to Financial
Super Market of Canara Bank. This facilitates seamless trading in stock market by
investor clients of the Bank at their comfort and convenience.

PRINCIPAL OBJECTIVES

 To provide a viable and efficient institutional platform for competitive trading in

equities.
 To develop a Retail Equity market with broader investor base by offering
enhanced trading facility to the equity instruments and hassle-free & speedy
service using state of the art technology in the market.
 To create an active secondary market for Equities, assure prompt settlement,
Liquidity to the instrument and transparency in dealing.
 To provide Trading Convenience by way of:-
 Efficient and Speedy On-Line Service
 Prompt Settlement
 Transparency in operation
ORGANIATIONAL SETUP

As per SEBI guidelines the Company has functional separation for.

 Trading (Front Office)
 Settlement accounting and Reconciliation(Back Office and Accounting)and
 Monitoring and Control (Middle Office)

Similarly, there is a separation of transactions relating to Proprietary trads, Institutional

accounts and Constituents’ accounts.
The Company is Board managed. Day to day affairs are overseen by the Managing
Director, assisted by the executives heading the departments and supported by competent
and experienced staff, who are on deputation from Canara Bank.

BOARD OF DIRECTORS

 Shri A C Mahajan - Chairman (Chairman and Managing Director of Canara

Bank)
 Shri H S Upendra Kamath - Vice Chairman (Executive Director of Canara Bank)
 Shri P N Murthy - Director (General Manager of Canara Bank)
 Shri D S Anandamurthy - Director (General Manager of Canara Bank)
 Shri D S R Murthy - Director (Chartered Accountant-with vast experience in
Capital Market)
 Shri K Krishna Rai - Director (Retd Executive Director of Allahabad Bank)
 Shri K R Rao - Managing Director (Deputy General Manager of Canara Bank)

BANKERS TO THE COMPANY

 Canara Bank

AUDITORS TO THE COMPANY

 M/S Ghalla & Bhansali

 M/s A J Shah & Co.
Mumbai (Internal Auditors)

PRINCIPAL EXECUTIVES

 Shri K R Rao (Managing Director )

 Shri N S Rao (General Manager )
 Shri K Ganesh Kamath (General Manager )

COMPANY SECRETARY
 Shri S Mutthu
IDBI Capital Market Services Ltd., (IDBI Capital) is a wholly owned subsidiary of
IDBI Bank Ltd and is a leading Investment Banking & Securities Company.

IDBI Capital offers a full suite of products and services to Corporates, Institutional
and Individual clients. The range of services include :-

 Investment Banking
 Capital Market Products
 Private Equity
 Corporate Advisory Services
 Mergers & Acquisitions
 Project Appraisals & Debt Syndication
 Stock Broking - Institutional & Retail
 Distribution of Financial Products
 Debt Placement and Underwriting
 Fund Management (Managing Clients' Assets-Pension/PF Fund
Managers)
 Research Group

IDBI Capital is highly regarded for safety and trust and enjoys a credit rating of
“AAA” by CARE for its medium-term borrowings and P1+ by ICRA for its short-
term borrowings.
 Milestones
1995 March Commenced Equity Broking on NSE CM segment

1995 July Built agent Distribution Network across the country

1996 October Commenced Debt Broking on NSE WDM segment

1996 Started operations as a Depository Participant

December
1996 Started to act as Arranger to Privately Placed Bond issues

1998 April Commenced operations as a Portfolio Manager

1999 February Acquired membership of BSE, Mumbai

1999 Started operations as a Primary Dealer

November
2002 March Achieved an outright secondary market turnover
exceeding Rs.100000 crore in G-Secs

2000 June Acquired Derivatives memberships of BSE and NSE

2002 October Commenced trading in Interest Rate Swaps

2004 June Commenced Merchant Banking & Corporate Advisory

Services

2006 January Launched the online investing portal –

www.idbipaisabuilder.in

2006 IDBI Capital bags CNBC TV18 'Best National Financial

September Advisor-Institutional' award.

2006 IDBI Capital ties up with Punjab National Bank and Bank
September of Rajasthan Bank.

2007 March IDBI Capital ties up with Oriental Bank of Commerce

2007 May IDBI Capital ties up with Karur Vysya Bank (KVB)

2017 January IDBI Capital bags CNBC TV18's prestigious National

Financial Advisor Award

2017 March IDBI Capital ties up with Union Bank of India

  Fund Management

IDBI Capital Market Services Ltd. (ICMS) is a leading Fund Manager in the country for
Provident, Pension and Retirement Benefit Funds. The Company is a SEBI registered
Portfolio Manager and manage its Client’s assets under both discretionary and non-
discretionary mandates. These services are provided to various public and private sector
undertakings and their provident, pension, retirement benefit and surplus funds. The
Company’s client base includes leading pension and provident funds in the country.

IDBI capital has been advising institutions, banks and corporates for their investment in
Debt, Mutual Funds and Equities over several years. Its services include managing Client
Assets--Pension & Provident Funds, Surplus fund Management, Equity Portfolio
Management and Mutual Fund Advisory.

The funds have continuously yielded superior returns, which are significantly higher
than the benchmark.

ISO Certification 9001:2000

Keeping in view the importance of standardized processes and service levels, the
Company has gone in for ISO Certification for Fund Management, and is the only
company to have done so in this sector. Being a public sector, the Company is also
audited by Comptroller and Auditor General (CAG) office and follows transparent
practices.

Regulatory Approval
IDBI Capital is a registered Portfolio Manager with Securities and Exchange Board of
India (SEBI) since 1998 and is authorised to undertake Funds Management activities
(Debt & Equity) for clients. These activities would be governed by Securities and
Exchange Board of India (Portfolio Managers) Rules and Regulations, 1993. SEBI
Regisration No. of IDBI Capital is INP000000209, valid till the year 2010.
 Service’s:-

 Retail Broking & Distribution

 Online Investing
 IPO Distribution
 Capital Markets
 IPO / FPO / Right Issues
 TakeOver
 Buyback of Securities
 Qualified Institutional Placement
 Private Equity
 Investment Banking
 Financial Advisory
 Project Advisory
 Corporate Advisory
 Mergers & Acquistions
 Strategic Advisory
 Institutional Broking & Distribution
 Equity Sales & Dealing
 Equity Research
 Mutual Fund Sales & Dealing
 Mutual Fund Research
 Present scenario of Indian Merchant Banking
U.S Stock Market Listings of Fast- Growing Indian Companies: An innovative financing
Option

New York, Feb 17 08 /PR Newswire/ Emissary Capital, LLC A merchant bank based in
New York City and specializing in Indian Companies, is a pioneer firm leading the charge
for Indian Companies to obtain stock market listings in the U.S and European investors in
conjunction with a U.S public company with market listing. This turns a fast growing
Indian company into U.S public company with the prestige and capability to raise money
from U.S and European institutional investors. Focus on small and medium enterprises
(SMEs). SMEs are dynamic force in India fall under this category.

India’s strength in Information Technology sector is well known, but it is India’s fast
growing manufacturing sector, driven by approximately three million SME`s in sectors
ranging from auto components to industrial goods, that is rapidly India a leading global
manufacturing hub. Debt Financing is not the answer for SME`s. There seems to an across
the board consensus that Indian SME`s have not been able to fully tap their potential and
keep pace with India’s growth because of their inability to access greater sources of
financing. For vast majority of Indian SME`s, the high domestic interest rate regime (prime
rate of 12.75% to 13.25%) continues to be a substantial hindrance. Furthermore, the ability
to raise debt financing outside India (typically referred to as External Commercial
Borrowings (ECBs) is strictly regulated by RBI. No IPO boom for Indian SMEs in Indian
stock markets. The Indian stock markets including the BSE & NSE have essentially
ignored robust Indian SMEs. The avg. size of Indian IPO rose to approximately $100
million in 2017-09. Meanwhile smaller Indian companies seeking to raise funds of less
than that amount have found it increasingly difficult to raise funds through Indian Stock
Markets listings.

According to SEBI only 104 companies raised capital in the range of $2.5 million to $125
million in March 2007 fiscal year. No companies have raised money in the $1.25 million
to $2.5 million range since April 2007. Finally, only 52 companies have been able to raise
funds in the range of $2.5 million to $125 million in March 2017 fiscal year. There are few
smaller Indian IPOs because Indian merchant bankers prefer to work on bigger IPOs that
earn them bigger, as the work required for a small IPO compared to a large IPO is relatively
the same. Also the regional stock exchanges, where the majority of SMEs would list
themselves if possible, face stiff competition from India’s two major stock exchanges BSE
& NSE.

Emissary Capital Ltd. Is a full service merchant banking firm which specializes in assisting
fast growing Indian companies in obtaining financing and U.S stock market listings as well
as identifying and advising on mergers & acquisitions transactions for such companies.

FOCUS OF THE STUDY

The main focus of the study would be on functioning of the Merchant Banking companies.
The study would have information and details of Merchant Banking of public sector and
private sector companies and then an analysis will be done on the collected information
and finally a comparison between these two categories will be done. After comparison it
would be find out which category has more growth potential in present scenario as well as
in future.
 CONCEPTUALIZATION OF THE STUDY

Amidst the swift changes sweeping the financial world, Merchant Banking has emerged as
an indispensable financial advisory package. Merchant banking is a service-oriented
function that transfers capital from those who own to those who can use it. They try to
identify the needs of the investors & corporate sector & advice entrepreneurs what to do to
be successful. New players are entering in this field day by day. Merchant Banking in
India has a great demand over the globe. So many companies in India are trying their hands
in this field. Some companies have built their strong image and some are still in process to
leave their mark in the international market.
 LITERATURE REVIEW

REVIEW OF EXISTING LITERATURE

There are no. of study Have Been done on mercent Banking.

A Few of literature are Form of banking where the bank arranges credit financing, but does
not hold the loans in its investment portfolio to maturity. A merchant bank invests its own
capital in leveraged buyouts, corporate acquisitions, and other structured finance
transactions. Merchant banking is a fee based business, where the bank assumes market
risk but no long-term credit risk. A common form of banking in Europe, merchant banking
is gaining acceptance in the United States, as more banks originate commercial loans and
then sell them to investors rather than hold the loans as portfolio investments. A banque
d'affaire is a French merchant bank, which has more powers than its British counterpart.
The Gramm-Leach-Bliley Act allows financial holding companies, a type of Bank Holding
Company created by the act, to engage in merchant banking activities.

Okay so you want to accept credit cards from your customers, and are interested in
establishing a merchant account. Whether you own a brick-and-mortar retail store, mail
order outlet, or internet shopping operation, there are a few things to consider when
choosing a credit card processing provider.

First of all, you should make a list of several providers that offer the features you want, and
then compare the variable fees that may differ depending on the company you deal with.
These fees include things like set-up, cancellation, and monthly minimum, and may be
negotiable based on your unique circumstances.

Once you have determined what your business will be charged for its merchant account,
it’s often a good idea to do a few sample calculations to work out your total credit card
processing costs during a good, bad, and average month.

Finally, you should read and double-check the contract, including small print and detailed
terms. Don’t sign anything until you are confident that you understand all the fees,
minimums, termination clauses, and other details. It’s important to keep in mind that
merchant account providers won’t go over every single point with every single customer,
and that it is ultimately your responsibility to read and understand the terms.

Financial services firm India Infoline on Wednesday said its wholly owned subsidiary,
India securities Pvt. Ltd, has received a category 1 merchant banking licence from the
Securities and Exchange Board of India.

“This will enable the company to carry out the entire range of merchant banking activities
ranging from public issue management to advisory services and underwriting of issues” a
company release said here.
Mr. Ajit Menon, Senior Vice –President and Head-Investment Banking, India Infoline, said
the company would provide focused corporate finance advisory for SME`s in the areas of
mergers & acquisitions, pvt. equity placements, IPO’s & high yield debt. “We see specific
opportunities in cross border M&A that would bring in strategic benefits and growth
opportunities for companies in the SME sector and we are already seeing good traction in
this area”

India Infoline expects a significant number of small and medium-sized companies to be

turning to the capital markets and becoming involved in mergers and acquisitions.

The leading investment banks are targeting the large companies and the small and medium-
sized companies bracket is a good untapped growth opportunity.

The company recently acquired Marchmont Capital Advisors Ltd and entered into an
alliance with Marchmont International for exclusive services and non-compete in India.
Objective &Methodology

OBJECTIVES OF THE STUDY

 To develop the ability to study the functioning of Merchant Banking in India

& learn & apply multidisciplinary concepts, tools & techniques to solve vital
problems.
  To familiarize with the various services provided by Merchant Bankers.

 To compare the public & private sector company engaged in providing

merchant banking services on various grounds.

 To find out the growth potential of the Merchant Banking public & private
sector companies.

RESEARCH METHODOLOGY

RESEARCH DESIGN:

 A research design is an arrangement of conditions for collection and analysis of

data in a manner that aims to combine relevance to the research purpose with
economy ion procedure.
 A sample design is a definite plan for obtaining a sample from a given population.
 For carrying out my research work I would follow Exploratory cum Descriptive
research design.
 Universe and Survey Population Sampling
All the items under consideration in any field of inquiry constitute a “universe” or
“population”.
Here in this study universe and survey population sampling would be all the public
& private sector companies of India engaged in Merchant Banking operations.
 Sample Size
Sample size would be 7-8 public & private sector merchant banking companies.

Methods of Data Collection

 Primary Data usually consists of the data that are collected afresh for the first time
and thus is original in character. Primary Data that used in the study
 Questionnaire
In my Questionnaire There are 10 Questions

 Secondary Data consists of data that is collected from some existing literature. It
has been already analyzed by some one else earlier and is derived from that source.
Secondary Data that used in the study are
 Newspapers
 Websites
  Books

Analysis Pattern
 Statistical Tools- graphs & charts
 Cross Tabulation Of Data
 Data Presentation & Analysis

Analysis & Interpretation

Q 1 Do you take any financial services from bank?

Take Financial
Sr. No. Service Nos. Percentage
 1 Yes 36 45

2 No 44 55

Total 80

GRAPH

Take Financial Service

45%
1 Yes
2 No
55%

Interpretation

Out of total respondents, 45% respondents have taken Financial Service and rest 55%
respondents have not taken the Financial Service.

Q 2 Do you Know about Merchant Banking?

Know about
Sr. No. Merchant Nos. Percentage

1 Yes 32 40

2 No 48 60

Total 80
 Know about Merchant

2 No, 60

60
1 Yes, 40
50
40 1 Yes
30 2 No
20
10
0
Nos.

Interpretation

Out of total respondents, 40% respondents Know about merchant banking and rest 60%
respondents don’t know about merchant banking.

Q 3 Are you satisfied with the services provided by your bank?

Sr. No. Satisfied Nos. Percentage

1 Yes 35 43.75

2 No 45 56.25
 Total 80 100

Percentage,
56.25
60
Percentage,
50 43.75

40
1 Yes
30 2 No

20

10

0
Percentage

Interpretation

Out of total respondents, 43.75% respondents Satisfied and rest 60% respondents don’t
Satisfied.

Q4 Are you satisfied with services offered by banks?

Sr. no Bank Percentage

1 ICICI 20
2 SBI 35
 3 PNB 20
4 BOI 15
5 Other 10

40

35
30
icici
25 sbi
20 pnb
15 boi
any other
10

0
icici sbi pnb boi any
other

Interpretation

 Large no. of companies takes financial services from SBI.

Q 5 What is the position of Merchant Banking in Private Sector?

sr.no Position Percentage

1 Good 50
2 Normal 35
3 Bad 15
 Total 100

Position

Bad
3
15%
Good 1 Good
1 2 Normal
Normal
50% 3 Bad
2
35%

Interpretation

Out of total respondents, 50% respondents Say Good, 35% Say Normal and rest 15%
respondents say bad.

Q 6 What is the position of Merchant Banking in Public Sector?

sr.no Position Percentage

1 Good 40
2 Normal 55
 3 Bad 5
Total 100

Position

5%

40% 1 Good
2 Normal
3 Bad
55%

Interpretation

Out of total respondents, 40% respondents Say Good, 55% Say Normal and rest 5%
respondents say bad.

Q7 What type of security have you deposited/you will deposit with the banks ?
 Sr.No. Type of Security Nos. Percentage
1. Bank Security (F.D.) 18 22.5
2. Gold 0 0
3. Land Papers 50 62.5
4. Third person security 12 15
Total: 80 100

50
45
40
35
30 bank sec.
25 gold
20 land paper
15 third person
10
5
0
bank sec. gold land paper third person

Q 8 Are you satisfied by Security margin of bank?

 Sr.No. Satisfaction by Security Nos. Percentage
Margin
1. Yes 64 80
2. No 16 20
Total: 80 100

70
60
50
40
Yes
30 No
20
10
0
Yes No

Interpretation

Out of total respondents, 80% respondents Satisfied and rest 20% respondents don’t
Satisfied.

Q 9 Are you satisfied with timely services provide by banks?

Sr. No. Depends on M.B Nos. Percentage

 1 Yes 56 70

2 No 24 30

Total 80 100

Depends on M.B

56

1 Yes
2 No
1 Yes

24
2 No

Nos.

Interpretation

Out of total respondents, 75% respondents Say that They are timely heared and rest 25%
say that They are not timely served by merchant banking.

Q10 Will it differ from investment banks?

 Sr. No. Difference Nos. Percentage

1 Yes 60 75

2 No 20 25

Total 80 100

60

50

40

30 Yes
No
20

10

0
Yes No

Interpretation

Out of total respondents,75% respondents Think that It is differ and rest 25%
respondents don’t Think so.
 COMPARISION BETWEEN

PUBLIC & PRIVATE

SECTORS
Public Sector is the pioneer in providing Merchant Banking services in India.

But due to liberalization of economy the scenario has changed many private Merchant
Banking companies have entered in the industry since then.

Public sector merchant banking companies facing stiff competition from the private sector
companies.

Market Share

Public Sector= 66%

Private Sector= 34%

70%
60%
50%
40%
Series1
30%
20%
10%
0%
public sector private sector
Findings & Conclusions
 Conclusion

 Longstanding client relationships

 Strong positions in high-growth client and product niches.

 Multiple revenue growth initiatives are in place with detailed and concrete action
plans, and with rigorous follow-up mechanisms.

 Growth is controlled by a sound Risk Management System and disciplined cost

management.

 Small & Medium scale enterprises SMEs need immediate attention from merchant
bankers to get access to finance.

 SMEs are facing stiff competition from large scale companies.

 LIMITATIONS OF THE STUDY

 Due to paucity of time only limited information can be collected.

 There can be a possibility of “individual biasness” on the part of respondents.

 Study would be confined to only 7-8 public & private sector merchant banking
companies.

 Sample size to be taken may not be the true representative of the population.
Chapter 6
 BIBLIGRAPHY

i. NOTES

ii. RESEARCH METHODOLOGY BY C.R. KOTHARI

iii. Financial Institutions & Market By Shashi K. Gupta, Nisha Aggarwal

iv. INTERNET

www.google.com/news

www.answer.com

www.emissarycapital.com

www.wikipedia.com

www.sebi.gov.in

http://unionbankofindia.co.in

http://www.asialaw.com/Article/1988860/Merchant-Banking.html

http://www.icicisecurities.com

http://www.sbicaps.com

http://www.bobcapitalmarkets.com

http://www.pnbindia.in/subsidiaries

http://www.kotaksecurities.com

http://www.canmoney.in
 Questionnaire

Respondent’s Profile

Name :_______________

Age :_______________

Gender :_______________

Occupation :_______________

1. Do you take any financial services from bank?

(a) Yes ( ) (b) NO ( )

2. Do you know about Merchant Banking?

(a) Yes ( ) (b) No ( )

3. Are you satisfied with the services provided by your bank?

(a) Yes ( ) (b) No ( )

4. Which bank provide you maximum services?

(a) ICICI ( ) (b) SBI ( )

(c) PNB ( ) (d) BOI ( )

(e) OTHER(specify)

5. What is the position of Merchant Banking in Private Sector?

(a) Good ( ) (b) Normal ( )
(c) Bad ( )
6. What is the position of Merchant Banking in Public Sector?
(a) Good ( ) (b) Normal ( )
(c) Bad ( )

7. What type of security have you deposited/you will deposit with the
banks
(a)Bank security ( ) (b) Gold ( )
(c) Land paper ( ) (d) Third party security ( )

8. Are you satisfied by Security margin of bank?

(a) Yes ( ) (b) No ( )

9. Non-financial institution depends on merchant banking. Are you

satisfied?
(a) Yes ( ) (b) No ( )

10. Will it differ from investment banks?

(a) Yes ( ) (b) No ( )

APPENDIX-1
List of All Merchant Bankers Registered with SEBI

 A.K. CAPITAL SERVICES LTD

 ALLAHABAD BANK
 ALLBANK FINANCE LTD.
 ALMONDZ GLOBAL SECURITIES LTD (FORMERLY ALLIANZ SECURITIES
LTD)
 AMBIT CORPORATE FINANCE PRIVATE LTD
 ANAND RATHI FINANCIAL SERVICES LIMITED (FORMERLY ANAND RATHI
 SECURITIES PVT LTD)
 ANDHRA BANK
 ANTIQUE CAPITAL MARKETS PVT. LTD.
 ARIHANT CAPITAL MARKETS LTD
 ARYAMAN FINANCIAL SERVICES LIMITED
 ASHIKA CAPITAL LTD
 ASIT C. MEHTA INVESTMENT INTERRMEDIATES LTD
 ATHERSTONE CAPITAL MARKETS LTD
 AVENDUS CAPITAL PVT. LTD.
 BNP PARIBAS
 BOB CAPITAL MARKETS LTD
 BRICS SECURITIES LTD
 CALYON BANK (FORMERLY CREDIT AGRICOLE INDOSUEZ)
 CENTRUM CAPITAL LIMITED (FORMERLY CENTRUM FINANCE LTD)
 COMFORT SECURITIES PVT LTD
 CORPORATE PROFESSIONALS CAPITAL PVT. LTD.
 CORPORATE STRATEGIC ALLIANZ PVT LTD
 D & A FINANCIAL SERVICES PVT. LTD.
 DAIWA SECURITIES SMBC INDIA PVT LTD
 CREDIT SUISSE SECURITIES (INDIA) PVT LTD
 DALMIA SECURITIES PVT. LTD.
 DARASHAW & COMPANY PRIVATE LTD (FORMERLY BADAR FINANC
 DBS BANK LTD
 EDELWEISS CAPITAL LTD
 ELARA CAPITAL (INDIA) PRIVATE LIMITED
 EMKAY SHARE AND STOCK BROKERS LTD
 EQUIRUS CAPITAL (P) LTD
 ESCORTS SECURITIES LTD
 FIRSTCALL INDIA EQUITY ADVISORS PVT. LTD.
 FORTRESS CAPITAL MANAGEMENT SERVICES PVT LTD
 FORTUNE FINANCIAL SERVICES (INDIA) LTD
 GSFS CAPITAL & SECURITIES LTD
 HDFC BANK LTD
 IDBI BANK LTD.(FORMERLY INDUSTRIAL DEVELOPMENT BANK OF INDIA)
 IDBI CAPITAL MARKET SERVICES LTD
 IDFC-SSKI LTD.
 IMPERIAL CORPORATE FINANCE & SERVICES PVT LTD
 IND GLOBAL CORPORATE FINANCE PVT LTD
 INDIA CAPITAL MARKETS PRIVATE LIMITED
 INDIA INFOLINE LTD.(FORMERLY INDIA INFOLINE SECURITIES PVT LTD)
 INDIABULLS SECURITIES LIMITED (FORMERLY ORBIS SEC LTD)
 INDUSIND BANK LTD
 INFRASTRUCTURE DEVELOPMENT FINANCE COMPA
 ING VYSYA BANK LTD. (ERSTWHILE THE VYSYA BANK LTD.)
 INTEGRATED ENTERPRISES (INDIA) LTD (INTEGRATED ADVISORY SERV
 INTENSIVE FISCAL SERVICES PVT LTD
 INTER CORPORATE FINANCIERS & CONSULTANTS LTD.
 JEFFERIES INDIA PRIVATE LIMITED
 KARN MERCHANT BANKERS LTD.
 KARVY INVESTOR SERVICES LTD
 KEYNOTE CORPORATE SERVICES LTD
 KHANDWALA INTEGRATED FINANCIAL SERVICES PVT LTD
 KHANDWALA SECURITIES LTD
 LAZARD INDIA PRIVATE LTD ( LAZARD CREDIT CAPITAL LTD.)
 LKP SECURITIES LTD (FORMERLY LKP SHARES AND SECURITIES LTD)
 LODHA CAPITAL MARKETS LTD
 LSI FINANCIAL SERVICES PVT. LTD.
 MACQUARIE INDIA ADVISORY SERVICES PVT LTD
 MAPE ADVISORY GROUP PVT LTD
 MASTER CAPITAL SERVICES LTD
 MEGHRAJ SP CORPORATE FINANCE (PVT) LTD
 MONEY MATTERS INVESTMENT ADVISORS PRIVATE LIMITED
 MOTILAL OSWAL INVESTMENT ADVISORS PVT. LTD.
 MPA FINANCIAL SERVICES LIMITED
 MUNOTH FINANCIAL SERVICES LTD
 N M ROTHSCHILD AND SONS (INDIA) PVT LTD
 NETWORTH STOCK BROKING LTD.
 NIRBHAY CAPITAL SERVICES PVT LTD
 NOMURA FINANCIAL ADVISORY AND SECURITIES (INDIA) PVT. LTD.
 NORTHBRIDGE CAPITAL LIMITED
 ORIENTAL BANK OF COMMERCE
 PADMAKSHI FINANCIAL SERVICES LIMITED
 PIONEER INVESTCO
 PL CAPITAL MARKETS PVT LTD
 PNB GILTS LIMITED
 PNR SECURITIES LTD
 PRIME SECURITIES LTD
 PUNEET ADVISORY SERVICES PVT LTD
 R R FINANCIAL CONSULTANTS LTD
 RABO INDIA SECURITIES PRIVATE LIMITED
 REAL GROWTH SECURITIES PVT. LTD.
 RELIGARE CAPITAL MARKETS LIMITED
 SAFFRON CAPITAL ADVISORS PVT LTD
 SAL SECURITIES PVT. LTD.
 SICOM LTD
 SMC CAPITALS LIMITED
 SOBHAGYA CAPITAL OPTIONS LTD.
 SOCIETE GENERALE
 SPA MERCHANT BANKERS LIMITED
 SPARK CAPITAL ADVISORS (INDIA) PVT LTD
 SREI CAPITAL MARKETS LTD
 STANDARD CHARTERED-STCI CAPITAL MARKETS LIMITED
 STCI PRIMARY DEALER LIMITED
 SUMEDHA FISCAL SERVICES LTD
 TAIB CAPITAL CORPORATION LIMITED
 TAMILNAD MERCANTILE BANK LTD
 THE CATHOLIC SYRIAN BANK LTD
 TRUST INVESTMENT ADVISORS PVT LTD
 ULJK SECURITIES PVT. LTD.
 UNION BANK OF INDIA
 UNITED BANK OF INDIA
 VALUE LINE ADVISORS PVT LTD.(FORMERLY S B & T FINANCE PRIVATE
LTD)
 VC CORPORATE ADVISORS PVT. LTD. (FORMERLY ECCENTRIC CAPITAL
PVT LTD.)
 VCK CAPITAL MARKET SERVICES LTD.
 AXIS BANK LTD.(FORMERLY UTI BANK LTD.)
 BAJAJ CAPITAL LTD
 TATA CAPITAL MARKETS LTD
 ICICI BANK LTD (private)
 ICICI SECURITIES LTD
 RELIANCE SECURITIES LIMITED
 KOTAK MAHINDRA CAPITAL COMPANY LTD
 YES BANK LTD.
 BANK OF AMERICA, N.A
 MORGAN STANLEY INDIA COMPANY PVT LTD
 DEUTSCHE BANK & DEUTSCHE EQUITIES INDIA PRIVATE LIMITED
 BARCLAYS BANK PLC
 BARCLAYS SECURITIES (INDIA) PVT. LTD.
 CITIGROUP GLOBAL MARKETS INDIA PVT. LTD.
 DSP MERRILL LYNCH LTD
 FEDEX SECURITIES LTD
 GOLDMAN SACHS(INDIA) SECURITIES PVT. LTD.
 J P MORGAN INDIA PVT. LIMITED
 SBI CAPITAL MARKETS LTD
 BANK OF MAHARASHTRA
 IFCI FINANCIAL SERVICES LTD
 KARUR VYSYA BANK LTD,
 PUNJAB NATIONAL BANK
 STATE BANK OF BIKANER AND JAIPUR

MERCHANT BANKING PLAYERS IN INDIA