Investment bankers function as intermediaries in financial transactions. They are experienced in carrying out projects that, for most companies, take place very rarely, but are critically important.
$dvisory services include assignments such as strategic planning, business valuations, assisting in financial restructurings, and providing an opinion as to the fairness of a proposed transaction.
A&ilit to !ork 'uickl 1ften, investment banking projects have very specific deadlines, for example #hen bidding on a company that is for sale. The investment bank must be #illing and able to put the right people on the project and #ork diligently to meet critical deadlines. (ee Structure (enerally, an investment bank #ill charge an initial retainer fee, #hich may be one'time or monthly, #ith the majority of the fee contingent upon successful completion of the transaction. It is important to utili"e a fee structure that aligns the investment bank2s incentive #ith your o#n. #ngoing Support 3aving #orked on a transaction for your company, the investment bank #ill be intimately familiar #ith your business. $fter the transaction, a good investment bank should become a trusted business advisor that can be called upon informally for advice and support on an ongoing basis. /ecause investment banks are intermediaries, and generally not providers of capital, some executives elect to execute transactions #ithout an investment bank in order to avoid the fees. 3o#ever, an experienced, quality investment bank adds significant cant value to a transaction and can pay for its fee many times over. The investment banker has a vested interest in making sure the transaction closes, that the project is completed in an efficient time frame, and #ith terms that provide maximum value to the client. $t the same time, the client is able to focus on running the business, rather than on the day'to'day details of the transaction, kno#ing that the transaction is being handled by individuals #ith experience in executing similar projects.
-ollo#ing are the some the roles normally banks play as part of the Investment banking activities.
$s sho#n above diagram the term investment banking refers to a #ide variety of activities. -ollo#ing are some of the important services that most of the the big investmnet banks offer. 4 4 4 4 4 $ssisting companies in capital increases 5e.g. issuing securities6 $dvising companies on mergers and acquisitions /rokerage activities 5acting as an intermediary in securities transactions6 Trading in specific products such as derivatives, forex products and commodities $dvising companies on ho# to optimise their use of equity capital and borro#ed capital
etc. Assisting companies in capital increases: To obtain ne# capital, a company can either raise equity by issuing or offering equity securities such as ne# shares. $lternatively, it can issue debt securities 5fixed'income securities6. There are different #ays of placing securities on the market. )rivate )lacement: $lso kno#n as a 0irect issue, #here in the company issues its o#n securities #hich it tries to sell in tranches to big investors. 1ften, the company does not consult Investment /anks for advice. 0oing this reduces the scope and cost of the operation and, the company hopes, allo# it to raise capital more quickly and easily. The issuing company alone
shoulders any placement risk. -or example, it may not sell all of its shares to obtain the desired amount. This method of placement is quite rare. It is generally used by companies #ishing to place their securities #ith a select group of investors rather than list them on an exchange. )u&lic )lacement: $lso kno#n as Indirect issue, the issuing company asks a bank to act as a mediator. /efore agreeing to this, the bank performs a background check on the issuer and examines the request. The issuing company7s reputation and credit rating 5based on solvency6 play an important role in this process. These factors also have a direct effect on the issue price. $fter it has verified the issuer, a bank must also check #hether there is sufficient demand for its equity securities on the market for an offering to take place. 1ften, a single bank does not handle the offering alone. If the offering is of a certain si"e, the bank #ill join #ith others to spread the placement risk. Together these banks form a /anking !yndicate or 8nder#riting !yndicate. In public placement, the bank 5or under#riting syndicate6 acts as an intermediary bet#een the issuer and investors. The issuing company can therefore choose the level of involvement of the bank. If it issues the securities itself and only uses the bank as an intermediary, the operation is called a )lacement on Commission* #here in bank just lend its services to the issuing company and gets the commission. i.e. bank #ill not bear any placement risk in this case. ' ' ' ' ' ' '' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' M19($: !T$:;&< Morgan !tanley has a long'standing and fast'gro#ing presence in India, #ith a number of Morgan !tanley companies providing a range of services in India to domestic and international clients.
-rom +=== until 1ctober >,,?, Morgan !tanley operated t#o joint ventures #ith @M -inancial (roup, under the name of @M Morgan !tanley. !ince 1ctober A, >,,? Morgan !tanley is expanding its o#n fully'o#ned premier investment banking and sales B trading platform in India, under the name of Morgan !tanley India %ompany Crivate ;imited, providing a full range of investment banking, sales B trading, fixed income, commodities and derivative products, as #ell as research services.
Morgan !tanley Investment Management 5M!IM6 provides customi"ed asset management services and products to governments, corporations, pension funds, non'profit organi"ations, high'net'#orth individuals and retail investors #orld#ide. 8nder the brand Morgan !tanley Mutual -und, it operates several domestic mutual fund products for retail investors in India.
$s of !eptember +D, >,,E Morgan !tanley also offers its Crivate to high net #orth investors in India.
Morgan !tanley $dvantage !ervices supports Morgan !tanley2s Institutional !ervices businesses, from research to financial modeling, portfolio analysis and IT development. Morgan Stanley India Company Pvt. Ltd. 18F/19F, One Indiabulls Centre, Tower 2, Jupiter Mills Compound, Elphinstone oad, Mumbai ! "## #1$ Tel% &91 22 '118 1### Fa(% &91 22 '118 1#11 Morgan Stanley Investment Management 18F/19F, One Indiabulls Centre, Tower 2, Jupiter Mills Compound, Elphinstone oad, Mumbai ! "## #1$ Tel% &91 22 '118 1### Fa(% &91 22 '118 1#2) Morgan Stanley India Company Private Limited Research, Sales & Trading 18F/19F, One Indiabulls Centre, Tower 2, Jupiter Mills Compound, Elphinstone oad, Mumbai ! "## #1$ Tel% &91 22 '118 1### Fa(% &91 22 '118 1#1* Morgan Stanley Advantage Services +thena, ,ld-. /o. *, 0e1tor $#, Mindspa1e, 2ore-aon 345, Mumbai "## #9# Tel% &91 22 ''"1 1### Fa(% &91 22 ''"1 1##1 Morgan Stanley Private Wealth Management 18F/19F, One Indiabulls Centre, Tower 2, Jupiter Mills Compound, Elphinstone oad, Mumbai ! "## #1$ Tel% &91 22 '118 1### Fa(% &91 22 '118 1#$" Morgan Stanley India Services Pvt Ltd. Global Markets India 18F/19F, One Indiabulls Centre, Tower 2, Jupiter Mills Compound, Elphinstone oad, Mumbai ! "## #1$ Tel% &91 22 '118 1### Fa(% &91 22 '118 1#11