Careers in Finance PDF

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Career Profiles in Finance

Table of contents
1. Analytics
2. Risk management
3. Credit Rating
4. Commercial Banking
a. Retail Banking
b. Wholesale/ Corporate Banking
5. Treasury
6. Corporate Finance
7. Financial Advisory Services
8. Investment Banking
9. Equity research
10. Asset management/ mutual funds
11. Project financing
12. Real estate
13. Securities sales & trading
14. Private Equity
15. Insurance
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Analytics
Description:
The fundamental goal of Analytics is to help organizations by leveraging data in the most
sophisticated manner to reach the right customer through the right channel, with the right
product, at the right price, and at the right time.
Analytics can progress along two lines:

Using existing patterns/metrics/performance indicators or Industry generic metrics or
Company specific metrics to analyze data
Using Sophisticated statistical/data mining tools to derive new performance
indicators i.e., Developing Statistical Models
Data collection and analysis are viewed as a continuing and iterative process and ideally over
time business decisions are refined based on feedback from earlier analysis and consequent
decisions. It follows procedures including data extraction, loading and cleansing, data
warehousing, data modeling, intelligence/ analytics, driving insight.
As customers avail of a basket of services, from a basic checking account to more advanced
loans and brokerage services, the channels and product offerings will have to be
continuously evaluated to ensure that a service provider is able to reach the customer with a
complete view of what the customers needs. In situations where personalized service is
required on an individual customer basis, it becomes important to look at transaction level
data, as compared to data summarized by just channels and/or products. This type of
individualized attention is standard for clinical trials in the pharmaceutical sector, and is also
relevant in areas such as Wealth Management.
Applications:
1. Consumer Finance
Analytics finds extensive applications in consumer lending of all types, and these can be
broadly viewed as a combination of marketing and risk management - both at the front end
and the back end. To start off, a company is interested in attracting the right kind of
customers for its products. A comprehensive profiling and segmentation exercise of its
existing customers will help a company identify prospects for the right kind of product.
Subsequent to profiling, Analytics can also help in:
Identifying prospects most likely to respond to a companys service offerings by

applying customized Response Scorecards.
Weeding out risky prospects by applying continually updated Acquisition Risk
Scorecards.
Determining magnitude of product offering by estimating the ability to manage the
risk of each acquired customer.
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Improving relationships with bad customers by building Delinquency Strategies
that will identify who among the delinquent customers will most likely make their
payments and return to a non-delinquent state.
Minimizing loss due to involuntary attrition through effective collections strategies
that identify customers who are most likely to pay some portion of their written off
amount.
Run complex market, credit and liquidity risk management calculations in real time
Manage credit limits and collateral
Controlling the costs of debt collection by identifying the optimal amount of
collections debt to be sold to 3rd party collectors.
2. Retail Banking
Every few years, the customers profiles are a result of continually changing lifestyles,
behavior patterns, risk attitudes and financial aspirations. Banks carry extensive amounts of
data in their systems from which profiles of each progressive stage of the customers
evolution can be studied and analyzed. Predictions of customer service requirements across
his/her lifecycle can be made by ensuring that the data hitherto silo-ed across various
functions is brought together to Having established what product the customer is ready for,
the next step is to identify the appropriate channel for reaching the customer. Adopting an
analytics driven Channel Optimization Strategy will help in determining the appropriate mix
of channels, whether they are ATMs, branches, private banking, tele-marketing, direct
mailing, or the Internet. Similarly, a Channel-Product Mapping exercise will help in identifying
the right channel to be used for each product offering.
3. Asset Management
On the asset management side, customer data can be used to focus on two types of
activities:
Revenue Generating Activities:

1. Customer profiling: to develop a view of the customer with respect to
demographics, product usage patterns, risk assessment, etc.
2. Intermediary/Channel Optimization: for maximizing channel revenues by proper
allocation of resources.
3. Product Development: to continually update product offerings that are aligned to
dynamic customer usage patterns.
Cost cutting Activities:

1. Asset Allocation Tool Development: for investment advisors involved in selling
financial planning and investment advisory services to prospective clients.
2. Performance Attribution: for analysis of portfolio performance/NAV vis--vis various
benchmarks, for computations of portfolio sensitivity with respect to the market
and/or benchmarks, etc.
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4. Insurance
The insurance industry is probably the one area which stands to leap forward the most from
analytics, given that currently, there is a low level of data mining and process automation in
use, as compared to the consumer banking industry. A data driven approach to decision
making will help in a number of areas, including:
Insurance Scoring: Developing models to predict the likelihood of occurrence of claims

using credit information along with the past history of claims filings.
Claims Analysis: Modeling for frequency and severity of claims leading to

1. Improved Pricing
2. Better Reserve Management
Underwriting Automation: Improving the efficiency of processes by automating decision

making criteria.
Customer Acquisition & Servicing: Maximizing returns on marketing expenditures through

1. Targeted Acquisition Campaigns
2. Channel Effectiveness, including analysis of internet, sales force, etc.
3. Cross-Selling
4. Proactive Renewal Strategies
Capital Allocation / Management: Maximizing portfolio ROI across lines of businesses such
as Casualty, Life, Property, Annuities, etc., by optimal allocation of capital.
New Product Development & Alignment: Designing and testing the efficacy of new
products specifically created in response to emerging market trends. Profiling customer
characteristics to better align existing products with the specific needs of the customers
Why and How to proceed?
As the relationship between a customer and a banking/financial services provider changes

with time, the opportunities to service those needs will continue to evolve. With the large
amounts of data on the customer available to tap into, organizations that use analytics have
the opportunity to distinguish themselves greatly from their competitors, and many
companies have already seen tremendous improvements in revenue generation and cost
cutting through analytics. Considering the wealth of applications of analytics techniques to
reach the customer, the departmental silos of old should give way to a more customer
centric view all through maximizing the potential of customer data. Having identified a
potential application of analytics, the testing and implementation process ensures that the
best possible solution is continually implemented in a timely manner. To achieve this end, a
key decision that an organization must take is the movement towards an analytics based
philosophy where data is consistently analyzed to generate maximum revenue gains and cost
benefits
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A team of systems specialists and data analysts is required to develop and maintain efficient
data marts and robust implementation & analysis systems. To conduct data analytics, teams
of econometric & statistical modelers and business analysts that can effectively perform
strategic analysis and build predictive models need to be developed.
Job Requirements:
The analytics job profile involves the use of a great deal of software and advanced
mathematical tools. Hence people preferred for the particular job must possess either
Masters/PhD in Econometrics / Industrial Engineering / Statistics or MBA / CA having
experience in Quantitative analysis in areas like Portfolio Analysis, Risk Management,
Financial Products Pricing, Market Research, Actuarial Analytics, Production Planning,
Inventory and Logistics Management.
Potential Recruiters:
American Express
HSBC Analytics
Brainmatics
Fractal
GECIS Analytics
ICICI One Source
I Gate (loans and mortgage)
Symphony (insurance, supply chain and financial services)
Modalytics (banking and investments)
MarketRx (medical and market analytics) (Gurgaon)
Mumbai's Orion Pro (banking, treasury and credit cards)
Inductis
Adventity
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Risk management
The risk management professionals determine the different potential risks associated with
the investments made by an enterprise. They constantly evaluate the market parameters,
where the emphasis is given to the instances where the enterprise can lose money. The focus
is to minimize the chances of loss on those occasions. Risk assessment helps the client in:
Understanding risk factors, Providing comprehensive list of the existing risk-coverage ,
Recommending ways to cover the yet-to-be covered risk gaps.
Financial risk management is the practice of enhancing firms value by using financial
instruments ((Derivatives etc.) to manage exposure to risk. As a specialization of risk
management, financial risk management focuses on when and how to hedge using financial
instruments (Derivatives, diff risk models etc.) to manage costly exposures to risk. In the
banking sector worldwide, Basel Accord are generally adopted by internationally active
banks to tracking, reporting and exposing operational, credit and market risks.
Credit Risk is the risk of loss due to a debtor's non-payment of a loan or other line of credit
(either the principal or interest or both). Some companies run a credit risk department
whose job is to assess the financial health of their customers, and extend credit accordingly.
Operational risk is defined as the risk of loss resulting from inadequate or failed internal
processes, people and systems, or from external events
Market risk is the risk that the value of an investment will decrease due to moves in market
factors. The four standard market risk factors are:
Equity risk, or the risk that stock prices will change.
Interest rate risk, or the risk that interest rates will change.
Currency risk, or the risk that foreign exchange rates will change.
Commodity risk, or the risk that commodity prices (i.e. grains, metals, etc.) will
change.
Different financial instruments, mechanisms are used to mitigate such risks.In India banks are
in process of implementation of Basel II guidelines. So there is huge requirement for Risk
management professional s in this field. Organizationally, financial risk management is
implemented in different ways. There may be, within the board of directors, a risk
committee. Usually, there is some sort of risk oversight committee, comprising senior
managers. In practice, various names are given to these two committees. A senior manager,
called the head of risk management or chief risk officer (CRO), reports to the risk oversight
committee. This head of risk management may oversee a single department called the risk
management department. Professionals working within that department, called risk
managers, are responsible for facilitating the taking of applicable financial risksmarket
risks, credit risks and operational risksby other departments within the firm.
Risk Management Adviser - Risk Analytics Group provides the quantitative analysis and
modeling support for risk management. This group is working on areas such as analysis of
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default rates, loss rates, risk based pricing, economic capital allocation and portfolio
modeling
American Express
Citigroup
HSBC Analytics
Aptivaa Risk Consulting
JP Morgan- Credit Analysis Unit
ICICI Bank
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Credit rating
Credit risk is the risk of loss due to a debtor's non-payment of a loan or other line of credit
(either the principal or interest (coupon) or both). There are 4 broad categories of credit risk:
1) Faced by lenders to consumers
2) Faced by lenders to business
3) Faced by business (e.g. credit sales)
4) Faced by individuals (e.g. as depositors or investors)
A credit rating agency (CRA) is a company that assigns credit ratings for issuers of certain
types of debt obligations. In most cases, these issuers are companies, cities, non-profit
organizations, or national governments issuing debt-like securities that can be traded on a
secondary market. A credit rating measures credit worthiness, the ability to pay back a loan,
and affects the interest rate applied to loans. (A company that issues credit scores for
individual credit-worthiness is generally called a credit bureau or consumer credit reporting
agency.)
Credit ratings are used by investors, issuers, investment banks, broker-dealers, and by
governments. For investors, credit rating agencies increase the range of investment
alternatives and provide independent, easy-to-use measurements of relative credit risk; this
generally increases the efficiency of the market, lowering costs for both borrowers and
lenders. This in turn increases the total supply of risk capital in the economy, leading to
stronger growth. It also opens the capital markets to categories of borrower who might
otherwise be shut out altogether: small governments, startup companies, hospitals and
universities.
The biggest credit rating agencies in India are ICRA, CRISIL, SMERA and CARE. In addition
this, most banks and many corporations have their own credit rating department.
ICRA
CRISIL
Fitch
CARE
Employment Opportunities:
We have used CRISIL as a benchmark for understanding the kind of job openings available in
this line of work. Our assumption is that most rating agencies have profiles similar to those
mentioned below:
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Commercial Banking
Commercial banks are in the business of providing banking services to individuals, small
businesses and large organizations. While the banking sector has been consolidating, it is
worth noting that far more people are employed in the commercial banking sector than any
other part of the financial services industry. Jobs in banking can be exciting and offer
excellent opportunities to learn about business interact with people and build up a clientele.
Today's commercial banks are more diverse than ever. You'll find a tremendous range of
opportunities in commercial banking, starting at the branch level where you might start out
as a teller to a wide variety of other services such as leasing, credit card banking,
international finance and trade credit. If you are well-prepared and enthusiastic about
entering the field, you are likely to find a wide variety of opportunities open to you.
Commercial banks vs. Investment banks
A commercial bank may legally take deposits for checking and savings accounts from
consumers. The typical commercial banking process is fairly straightforward. You deposit
money into your bank, and the bank loans that money to consumers and companies in need
of capital (cash). You borrow to buy a house, finance a car, or finance an addition to your
home. Companies borrow to finance the growth of their company or meet immediate cash
needs. Companies that borrow from commercial banks can range in size from the dry cleaner
on the corner to a multinational conglomerate. The commercial bank generates a profit by
paying depositors a lower interest rate than the bank charges on loans.
An investment bank operates differently. An investment bank does not have an inventory of
cash deposits to lend as a commercial bank does. In essence, an investment bank acts as an
intermediary, and matches sellers of stocks and bonds with buyers of stocks and bonds.
Note, however, that companies use investment banks toward the same end as they use
commercial banks. If a company needs capital, it may get a loan from a bank, or it may ask an
investment bank to sell equity or debt (stocks or bonds). Because commercial banks already
have funds available from their depositors and an investment bank typically does not, an I-
bank must spend considerable time finding investors in order to obtain capital for its client.
(Note that as investment banks are increasingly seeking to become "one-stop" financing
sources, many I-banks have set aside billions of dollars of their own capital that they can use
to loan to clients directly.)
A commercial bank can be a retail bank, or a wholesale bank, or both.
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Retail Banking
Retail banking is typically mass-market banking where individual customers use local
branches of larger commercial banks. The products/ services offered include:
1. Deposit Accounts: Savings accounts, Current Accounts, debit cards etc.
2. Loan Based: Personal loans, credit cards, consumer loans, car loans, home loans etc.
3. Mortgages
Retail banking involves job profiles for students from both finance & marketing background.
But recently, given the competitive nature of the market with the entry of a large number of
public sectors, private sector and foreign banks competing with each other for business;
marketing has become an important function within a bank for retail business. The career
profiles are more centric towards Marketing of Financial Services.
A typical organization of retail department in bank including various associated products &
services can be shown as:
Head of Retail Banking
Product Head Product Head Product Head

Investment & Services Deposits Products Loan Products
Product Manager (PM) Retail (PM) Car

Mutual Funds Savings & Loans
Deposits
(PM) (PM) Private (PM)

Bancassurance Banking (HNI) Consumer Financ
(PM) Forex (PM) Internet (PM) Credit

Services Banking Cards
(PM) RBI GOI (PM) Salary (PM) Personal

Bonds Accounts Loans
Zonal or Regional Product Managers / Sales Managers for

respective product categories
Branch Level Relationship Managers / Sales Managers / (Officers)
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Typically, marketing / finance graduates from premier management institutions find
openings in any one of the following broad areas in banking & financial services companies:
1. Product management
2. Relationship management
3. Sales & Distribution
4. Customer Service (branch level & call centre, closely linked with operations
function)
Job Profiles/ Responsibilities:
1. Product management: Corresponding responsibilities might include:

a. Budgets: Manage allocated budgets for that product
b. Market Research
c. Product Innovations
d. MIS Keep track of stock and sales figures at the branch and regional level
2. Relationship management: Involves Maintaining relationships with business entities,

Handling DSAs or DSTs and business leads generated from other channels, Customer
Interaction. Various types of relationship manegement are:
a. Relationship Manager Investment & Services : Offering I&S services to
individual, HNI or institutional / corporate customers of banks. Products
include mutual funds, RBI bonds, Insurance, etc.
b. Relationship Manager Personal Banking (Retail) : Retail means individual
customers of the bank. They manage customers for services like savings
accounts, deposits, debit cards, cross sales of loan products, etc.
c. Relationship Manager Private Banking : With the exclusive mandate to
manage HNI / Premium individual accounts of the branch / region.
Relationship managers typically have sales targets and enhancement of relationship
value (ERV) targets. They are also involved in servicing the customers. Their personal
attributes include: a pleasant personality, good communication skills, reasonably
good aptitude for sales and excellent product knowledge.
3. Sales & Distribution: This function is similar to sales as one sees it in FMCG or
consumer durables companies. In fact, at times banks also recruit marketers / sales
managers from such companies to take care of product management or distribution
functions.
Banks use agents, brokers or Direct Marketing Associates / Direct Sales Associates
(DMAs/DSAs) to increase sales. These are typically individuals or partnership firms who
recruit sales executives to move in the field and generate sales. Sales & Distribution can
involve any of the following:
1 Generate sales through customers walking into the branch, through CSEs as
discussed earlier.
2 Generate sales through sales executives on banks payroll.
3 Generate sales through DMEs as discussed above. Currently RBI does not
permit sales of deposit products through DMEs, but credit cards and loan
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products are freely sold through these agents. The job of the sales manager is
to appoint, train and supervise these DSAs.
Sales & Distribution at the branch level is headed by the branch manager himself. At
times, relationship manager of the respective product category may also look after this
function.
4. Customer Service: At the central office level, customer service function may be
closely involved with Customer Relationship Management (CRM) initiatives. Banks
like ICICI Bank and HDFC Bank have typically have lakhs of customers holding millions
of accounts with them. Managing such a huge number of relationships is certainly a
challenge. Banks use concepts like datamining and advanced MR and statistical
techniques to focus service and cross-sales initiatives on an identifiable set of
customers.
5. Branch Manager: will primarily be responsible for balance sheet growth, revenue
generation, customer acquisition, customer retention, and cost efficiency through
processes, managing the branch team
6. Business Development Manager: In some banks, this designation is same as Product

Manager & involves the task of developing the business further.
Future options after entering Retail Banking: Retail bankers who yearn for higher risk and
challenges (and higher rewards with success) may become investment bankers with
experience. A number of former bank officers enter the securities industry and become
brokers, traders, and salesmen owing to their exposure in the financial market.
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Wholesale Banking
Wholesale banking refers to dealing with large customers often multinational companies,
governments or government enterprises. Wholesale banking is the term used for
transactions between banks and large customers (corporate and government) involving
large sums. It includes the transactions which the banks conduct with each other via
interbank markets separate from customers. Wholesale banks do not extend home
mortgage credit, consumer loans to retail customers or loans to small businesses or small
firms.
The following features distinguish wholesale banking from retail banking:
Retail banks deal with a large number of small value transactions whereas wholesale
banks deal with a small number of large value transactions.
Wholesale banks do not involve themselves in the payments mechanism to any great
extent so that cash holdings are minimal.
The extent of their dealing in inter-bank market.
The high proportions of assets and liabilities are in foreign currency in wholesale
banking as opposed to retail banking.
Usually separate subsidiaries of the same bank deal in retail banking and wholesale banking
at the same time. So wholesale banking characterizes the type of the transaction rather than
type of financial institution.
The practices basic to wholesale banking are:
Interbank markets in domestic and foreign currencies.
Issue of certificates of deposit in domestic and foreign currencies.
Lending by means of term loans.
Banks in order to have clarity of functioning have further divided corporate banking into the
following:
Global Clients
Local Clients
Small & Medium Enterprises
Companies are slotted into one of these categories based on criteria set within the bank. This
criteria varies from bank to bank. The work in all three categories is very similar.
Before sanctioning any sort of loan or financial assistance to its clients, the banks first need
to analyze the client in terms of his financial position and his credit worthiness. For this
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purpose a document is prepared in a pre set format which contains the requisite information
regarding the potential client. This document is scrutinized by the approving authority which
usually consists of the region or country heads. Once the limits are sanctioned the client is
notified of the same. The client is then permitted to use loan facility as and when he wishes
to, provided it is within the limit. This entire process involves immense client interaction. For
the corporate no matter which product or facility he uses he wishes to have a one point
contact within the bank. This one point contact is the relationship manager. The relationship
manager heads a team. Clients of the bank are mapped to various relationship mangers. They
have targets in terms of income. This they need to achieve by dealing with the clients
mapped to them.
Profiles on offer:
Business Development Manager This profile is applicable to both assets and
liabilities division. Their responsibilities entail scouting for new customers for the
bank
Relationship Manager Applicable to both assets and liabilities divisions again. They
are the one point contact for the customers to solve any banking related issues. Also,
in case there is some specific requirement, he/she is the intermediary between the
product specialist and the customer
Investment advisory services: Customers with excess of funds in their account might
approach a bank to utilize the funds in a better way. The job of a Investment Advisor,
on the basis of the risk profile of the customer, suggest a variety of investment
products such as mutual funds (Debt/Equity based)
Matching & Liquidity in wholesale banking

The basis of operations of wholesale banking is the principle of matching. From outside it
seems that as wholesale banks have less number of customers, they are able to manage their
liquidity by matching the maturity dates and currency denominations of their assets and
liabilities. But wholesale banks do not completely match their assets with their liabilities and
therefore they do engage in maturity transformation by borrowing for a shorter period than
that for which loans are made.
Wholesale banks maintain their liquidity position by:
Using the interbank market this market involves banks lending and borrowing from
each other. If a wholesale bank has got a surplus fund, it will lend the excess to
another bank. Similarly if a wholesale bank is short of fund, it will borrow the money
from another bank. Interbank transactions can be from 15 days to 3 months.
Sale of asset based securities (ABS) - An ABS is a tradable financial instrument, which is
backed by a pool of loans. The sale removes assets from the balance sheet of the
bank and provides the fund for alternative use.
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1. ICICI Bank
2. Barclays Bank (retail banking)
3. HDFC Bank
4. Yes Bank (wholesale/corporate banking)
5. Standard Chartered Bank (wholesale/corporate banking)
6. ABN-AMRO Bank
7. Axis Bank
8. BNP Paribas
9. Deutsche Bank
10. UBS
11. ING Vysya
12. Kotak Mahindra Bank
13. IDBI Bank
14. Capital One
15. Morgan Stanley
16. Rabo Bank
17. Calyon Bank
18. Citibank
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Treasury
Treasury management in Banks

In commercial banks, treasury refers to the fund and the revenues at the disposal of the bank
and day-to-day management of the same. The treasury unit acts as the custodian of the cash
and other liquid assets. The art of managing, within the acceptable level of risk, the
consolidated fund of bank optimally and profitably is called treasury management in banks.
Apart from doing the above-mentioned activities, the treasury of a bank deals with currency
trading, interest rate swaps, and currency forwards and swaps, G-Sec trading and other
products related to it. Also it is the duty of the Treasury department of a bank to satisfy the
ALM constraints as put by the Risk department. In India, all banks are having active treasuries
dealing in different products.
Treasury management in Corporate
Corporate manage their treasuries by commercial papers. There has been an increased focus
on governance and increasingly adventurous activity in the capital markets. Depending upon
the corporate, the treasury department does one or two special roles that have been listed in
the various roles of banks. E.g. a treasury department in a software company will be looking
at managing currency risk and may be at times placing excess cash to get some returns. In
case of a FMCG company, the treasury will be dealing more into the swaps of their loans etc.
from fixed to floating and vice-versa. Also all treasuries in the multinational companies
ensure that the company is adequately funded in terms of cash and ensure that the
payments are coming and going as per the normal cycle.
Following are the divisions across all the banks in India:
Asset Liability Management Desk (ALM)
Interest Trading Desk
Institutional Bonds Desk
Derivatives Sales desk
Derivatives Structuring desk
Foreign Exchange Floors (trading)
Option Traders
Credit & Market Risk Desk
Treasury Sales Team
Following is what each division does and their requirements in terms of qualifications of
people.
Asset Liability Management Desk (ALM):
This profile is concerned with the Cash Management and the B/S of the bank
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Interest Trading Desk
The people here trade in Government securities, Treasury Bills, Gilts and some
Corporate bonds.
Knowledge of the Bond market and Macroeconomics essential
Institutional Bonds Desk
Trading in corporate bonds
Derivatives Sales desk
This is typical sale of financial product profile which requires expert understanding of
derivatives market. These people get the highest bonuses out of all treasury people.
A Derivatives Structuring desk
This too requires an understanding of the derivative market
Foreign Exchange Floors (trading)
These people work as Relationship Managers for their clients for whom they
exchange Foreign Currency.
Option & Futures Traders
This profile is also about trading in Options and Futures, so a thorough understanding
of this market is essential.
Credit & Market Risk Desk
These people should also know Excel very well. They are into Risk management and
work in close relation with other treasury desks.
Treasury Sales Team
This team is into sales of Treasury products. It requires lot of running around work
and a good understanding of the financial scenario.
Job Profiles that are offered in treasury

1. Asset Liability Management
2. Dealer Forex, G-Sec, Call Money, Swaps (IRS & CCS)
3. Research Analyst
Generally, the fresh MBA graduates start in the 1st or 3rd category wherein they try to predict
the next days prices by analyzing the yield curves, predicting MIBOR & LIBOR and other
types of projections. The job profile of the person in the 1st category is to keep a track of the
inflow and outflow of the cash so that the bank is adequately funded.
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1. ICICI Bank
2. Axis Bank
3. HDFC Bank
4. Some FMCG/Group companies may offer this profile
5. Standard Chartered
6. ABN Amro
7. BNP Paribas
8. Kotak Mahindra Bank
9. Avendus Advisors
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Corporate Finance
Is it better to spend the last of the money for movie, party or food? Is it better to spend more
money on a trip with friends to shimla or save money to buy a gift for your girlfriend? These
are just some of the challenging decisions that we face in day to day life, but if theyre
challenges youd enjoy meeting, then corporate finance is the area that you want to be in. In
this career, youll have to make risky financial decisions, and convince others that youre
right.
Value based investment or expenditure is the essence of the Financial Management. Every
suitable financial concept must be analyzed and applied from the viewpoint of each stake
holder before final decisions are taken. Knowledge of new financial concepts including
derivatives, portfolio management etc., is of great importance in order to enable Financial
Managers and Senior Executives to arrive at better alternative investment decisions. Analysis
of financial portions of economics will also enable them to draft legislation or improve
existing legislation to protect the interest of stake holders and to curb the speculations and
malpractices.
Corporate finance job in simple terms aims to understand and analyze financial statements
with a view to taking corporate finance decisions.
What does a career in this sector entail?
The area entails several jobs some of which are:-
1. Providing new services and products by different banks

This may involve providing short-term loans for providing working capital
requirements, term loans, bridge loans, overdrafts and many products that are
offered by different banks to meet the corporate financing needs.
2. Funding of companies operations and source of funds

For ongoing operations the company has to raise loans to finance its working capital
or meet them put of its ongoing operations. Thus, the source of funds has to be
decided to meet these financing needs of the company and then best available
source has to be chosen so as to get the best deal for the company keeping in mind
the need of the company na the purpose for which funds are being raised
3. Minimizing risks
The company has certain financial risks present in its operations. These have to be
mitigated using the different products available in the market. With new and and a
wide array of complex products available in the market the job of corporate finance
analyst is becoming more and more challenging to mitigate the companys financial
risks associated with its operations.
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4. Trade Finance
Trade finance primarily consists of short term finance of Bill Discounting and Inter
Corporate Deposits. These products provide high liquidity on account of shorter
maturities. The trade finance activities of the company provide working capital for
companies to meet the seasonal demands. The portfolio may be spread over a wide
range of industries comprising of textiles, sugar, food processing, light engineering,
pharmaceuticals etc.
5. Advising on business plans or developing business plans for companies venturing into
new areas, products or markets
Each business plan should be tailored to the particular circumstances of the business
concerned and often may be targeted at potential investors. As a management tool,
the business plan should be a living document used first and foremost by
management. However, it may also serve a specific additional purpose - it is one of
the key means by which any finance provider will make a decision about lending
funds and in these circumstances it should aim to convince potential investors of the
company's ability to exploit its potential.
6. Due Diligence
Strategic transactions must be carried out with informed decision-making rather than
guesswork. Due diligence helps protect corporates from nasty surprises when
involved in:-
Business acquisition or sale

Financing proposals
Public or private placements
The due diligence is required by investors, lenders, businesses involved in a purchase or

sale and intermediaries such as investment bankers. Due diligence helps in providing
information and insight on
Operations of a buyers
Risks of a transaction
Value at which a transaction should be undertaken
Warranties and indemnities that should be obtained from the vendor
7. Mergers and acquisition

Specialist corporate finance teams focus on adding value to the corporates at each
stage in the process of acquiring a business. They help in devising an acquisition
strategy, finding the right target, negotiating the deal, investigating to reduce risk
and completing the deal. They also develop the post acquisition strategy to ensure
the success of the merger or acquisition deal.
8. Advising on Selling a Business

This is similar to the mergers and acquisition role described above just that focus is
on adding value at each stage in the process of selling a business. So, here the focus
is on preparing for sale, marketing to identify the best purchasers, negotiating and
21
closing the deal for the business that is willing to move out so as it gets the best deal
and value out of it.
9. Valuation
Determining a companys worth is more important than ever before. Whenever a
company is planning to purchase, merge with, or sell an enterprise, transfer
intangible assets, enter into a licensing agreement, address estate, gift, or other
taxation concerns, or comply with corporate finance and risk management
requirements the valuation becomes important to evaluate each of the proposals in
proper light. These valuations are not generally done by corporate finance
departments of the companies but by the third parties so as to provide an unbiased
estimate of the company valuation.
Careers for fresh MBAs
Large corporates have corporate finance departments of their own to mange their funds on
a day to day basis and to decide the on the financing needs of the company like raising of
loans for working capital, getting the best interest rate deal for the company, managing risks
as to companies operations and the flow of money etc.
Apart from this the consultants and banks recruit corporate finance specialists/advisors who
advise different corporates (i.e. the clients of these consultants/banks) on meeting their
financing needs and offering products to them so as to best meet their need.
The importance of the area can be judged by the fact that this subject is covered in almost all
the B-schools of this country.
Some of the topics which one should be aware of are:-
Basics of commercial accounting and balance sheets

Discounted Cash flow technique and internal rate of return
Budget
o Performance budgeting
o Zero-base Budgeting
o Cost benefit analysis
CAPM model, Valuation of bonds and securities, capital budgeting decisions etc.
Portfolio Management
Derivatives instruments and other financial products in the market
International Financial management
The key qualities
An excellent problem solver

A clear communicator who loves working with numbers
Professional in use of spreadsheets and other number crunching software
Enjoying making short- and long-term moneymaking goals and Choosing the best
way to raise funds for growth
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Financial advisory services
The financial advisory services offered by companies may me classified into these broad
heads where MBA students are generally recruited. The service offerings may vary from
company to company.
Due diligence services

Investment banking
Valuation and strategy
Business recovery services- like business improvement, liquidation and solvency,
performance monitoring etc
Tax services
Restructuring services
Fraud and forensic investigation services
Helping corporates list overseas
Post deal services
Project finance and privatization
Takeover support
A financial institution is one which is offering professional advice to companies and also
preparing documentation for submission to the regulator, the exchange, shareholders,
investors, and the general public for the purpose of public offering of stocks, stock
listing, corporate financial restructuring, preparation of a company rehabilitation plan,
etc.Financial advisors may help their clients invest for both long and short term goals. It is
the financial advisor's duty to determine the clients' goals and risk tolerance and then to
recommend appropriate investments
Generally all banks and consultancy companies have a financial advisory cell.
23
Investment Banking
Sector Outline and Nature of Services provided:
Investment banking is, arguably, the most glamorous field in financial services. However, the
luxurious lifestyles, multi-million dollar deals, the jet-set life and the pulse throbbing
excitement are just a polished veneer of what is otherwise a demanding, stressful, and at
times, grueling career option. An investment banking career makes even the toughest b-
school education seem like vacation. However for the focused, sharp and dynamic business
executive, a career in I Banking can be a life-long adventure.
The Investment Banking industry is concentrated in the major financial centers of the world,
viz. London, New York and Tokyo. Although most I Banking firms have offices in countries
throughout the world, these offices serve only the local market requirements. Most
international transactions and deals are routed through and processed in the major financial
centers.
Investment banking is not one specific service or function. Investment Banks serve clients
with complex financial needs. It is a bouquet of a range of activities, which include
underwriting, selling, and trading securities (stocks bonds and derivatives); providing
financial advisory services, such as mergers and acquisition advice; and managing assets.
An Investment Bank usually provides the following services to its clients:

Corporate Finance and advisory work, which is normally in connection with new
issues of securities for raising finance, take-overs, mergers and acquisitions;
Banking, for governments, institutions and companies;
Treasury dealing for corporate clients in currencies, with financial engineering
services to protect them from interest and exchange rate fluctuations;
Investment management, for corporate pension funds, charities, private clients,
either via direct investment for the more wealthy or via unit and investment trusts. In
the larger firms, the value of funds under management runs into many billions of
dollars;
Securities trading, in equities, bonds or derivatives and offering broking and
distribution facilities.
Thus it can be seen that Investment Banks offer various consultancy, investment and
financial services to their clients. These functions are very different from those done by
commercial banks, which are mainly into acceptance of deposits, lending, trade finance, etc.
The client profile of Investment Banks is also different and is made up of big corporate
groups, governments, NGOs and wealthy individuals or family trusts. Due to the niche
character of their services, Investment banks are small in employee strength when compared
to commercial banks.
Investment bankers prepare idea pitches that they bring to meetings with their clients, with
the expectation that their effort will be rewarded with a mandate when the client is ready to
undertake a transaction. Once mandated, an investment bank is responsible for preparing all
materials necessary for the transaction as well as the execution of the deal, which may
24
involve subscribing investors to a security issuance, coordinating with bidders, or negotiating
with a merger target.
Sales and Trading is often the most profitable area of an investment bank,
responsible for the majority of revenue of most investment banks. In the process of
market making, traders will buy and sell financial products with the goal of making an
incremental amount of money on each trade. Sales is the term for the investment
banks sales force, whose primary job is to call on institutional and high-net-worth
investors to suggest trading ideas and take orders. Sales desks then communicate
their clients' orders to the appropriate trading desks, who can price and execute
trades, or structure new products that fit a specific need
Research is the division which reviews companies and writes reports about their
prospects, often with "buy" or "sell" ratings. While the research division generates
no revenue, its resources are used to assist traders in trading, the sales force in
suggesting ideas to customers, and investment bankers by covering their clients. In
recent years the relationship between investment banking and research has become
highly regulated, reducing its importance to the investment bank
Structuring has been a relatively recent division as derivatives have come into play,
with highly technical and numerate employees working on creating complex
structured products which typically offer much greater margins and returns than
underlying cash securities
Risk Management involves analyzing the market and credit risk that traders are
taking onto the balance sheet in conducting their daily trades, and setting limits on
the amount of capital that they are able to trade in order to prevent 'bad' trades
having a detrimental effect to a desk overall. In recent years the risk of errors has
become known as "operational risk" and investment banks provide measures to
address this risk
Career Opportunities:
Major Investment banks recruit graduates from top B-Schools for their top entry level
positions. Recruits have to master technical skills for transaction processing as well as market
skills for acquiring and retaining clients. Although, there are many areas of specializations
within Investment banks, the entry level recruits in the core I-banking business are basically
placed in any one of the following broad areas.
Advisory (M & A and Industry Teams):

As an analyst in Mergers & Acquisitions (M&A), the primary focus will be working on
M&A transactions within a specific country. However, there is plenty of scope to
work across sectors and analysts gain a broad base of exposure. On a deal team, an
analyst will work alongside colleagues with local market knowledge and expertise in
executing M&A transactions in that country.
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An analyst in an industry team such as Natural Resources clients for example, will
leverage his industry expertise and help market the Banks M&A, Debt and Equity
products to companies in the mining, oil and gas and chemical sectors. If, for
example, a buy-side marketing effort is successful, an analyst will help manage the
transaction process, working on the transaction itself and co-ordinating the efforts of
each of the various teams involved.
Debt Capital Markets:

An analyst will play a central role in the Debt Capital Markets (DCM) team of an
Investment Bank. The DCM team will rely on his analytical and time-management
skills and expect him to take rapid ownership of key components of the interaction
with clients.
He will be actively involved in all aspects of new business solicitation, developing new
ideas and pricing new issue opportunities. He will need to develop his key skills
quickly. He will also work closely with the bank and bond Syndicate teams, help focus
the respective sales forces on the transaction and assist them in answering credit
related questions. Analysts coordinate the documentation process with lawyers and
the internal Transaction & Execution group, as well as due diligence sessions with
Management.
Equity Capital Markets:

In raising equity for a new company for example, an analyst starts by writing
recommendations on the nature and structure of the transaction. The next part is to
work with management to prepare the companys marketing materials, then
organise the offering process with lawyers and accountants and start assessing the
level of demand from targeted investors. It involves constant communication with
M&A and Equity Sales, Trading and Research to understand the companys strategy
and valuation, and investor views on the story, and communication with
syndicate banks to organise the marketing of the offering.
While working on an equity derivatives trade an analyst is a key liaison with the client,
understanding their needs and assisting in cultivating the client relationship on an
ongoing basis. By understanding the clients objectives, he can then advise them on
a wide range of derivatives solutions, using the Banks trading and research
capabilities to provide them with the optimal solution to their needs.
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List of Investment Banks Recruiting in Indian B-Schools:
The following are some Investment banks that generally come to Indian B-Schools to recruit
executives for their top notch entry level positions:
Banque Nationale de Paris

Barclays Capital
Citigroup
Credit Suisse First Boston
DBS Bank, Singapore
Deutsche Bank
DSP Merrill Lynch
Goldman Sachs
HSBC
ICICI Bank
JM Morgan Stanley
JP Morgan
Kotak Group
Lehman Brothers
Merrill Lynch
SBI Capital Markets
UBS Investment Bank
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Equity research
Securities research is a discipline within the financial services industry. Securities research
professionals are known most generally as "analysts," "research analysts," or "securities
analysts;" all the foregoing terms are synonymous. Securities analysts are commonly divided
between the two basic kinds of securities: equity analysts (researching stocks and their
issuers) and fixed income analysts (researching bond issuers). However, there are some
analysts who cover all of the securities of a particular issuer, stocks and bonds alike.
Equity Research Analysts are usually further subdivided by industry specialization -- among
the industries with the most analyst coverage are biotechnology, financial services, energy,
and computer hardware, software and services, automobiles, mining, retail etc.
In the broadest terms, equity research analysts seek to develop, and thereafter communicate
to investors, insights regarding the value, risk, and volatility of a covered security, and thus
assist investors to decide whether to buy, hold, sell, sell short, or simply avoid the security in
question or derivative securities. To gather the information required to do so, securities
analysts review periodic financial disclosures (such as made by United States-listed issuers to
the S.E.C., i.e. Annual Reports, Quarterly Reports etc) of the issuer and other relevant
companies, read industry news and use trading history and industry information databases,
interview managers and customers of the issuer, and (sometimes) perform their own
primary research.
Career Path
Entrance into the profession, which is generally very well paid and prestigious, is highly
competitive. Those who enter the profession at the junior level typically have an
undergraduate degree from a leading college or university and one to a few years of
experience in some other discipline of finance or (lacking such experience) an MBA or other
relevant advanced degree. Those who enter the field in a junior capacity can progress to a
senior capacity in a fairly brief period of time (two to four years) if they prove themselves
talented; often such advancement is greatly aided by earning a Chartered Financial Analyst
charter (which requires passage of three, successively more difficult examinations over a
period of not less than nineteen months). Many securities analysts have directly entered the
profession at a more senior level; such persons typically have an MBA or other relevant
advanced degree and a number of years of progressively responsible experience either in
another finance profession, or in the industry which they will be covering as an analyst.
The main responsibilities of the Analyst can be summarized are as follows:
Gathering and analysing data from a variety of sources, including company reports,
the internet, online databases and JPMorgan proprietary content.
Building, maintaining and analysing financial models of companies and industries;
generating regular and one off reports, graphs and datasets from these models,
using standard JPMorgan model formats.
28
Writing content (text, tables and charts) for company and industry reports and
presentation to be used internally and published externally by colleagues in other
parts of global research.
Maintaining regular contact with colleagues in the global sectors, taking part in
conference calls and responding to project requests (often client-generated).
Goldman Sachs
JPMC
BRICS Securities
India Infoline
Motilal Oswal
And other Indian I-banks and brokerage houses
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Asset management/ Mutual Funds/ Money Management
Asset management is the business of making money with money. Asset managers manage
money - other people's money, and gobs of it. Generally, they convert that money into assets
- stocks, bonds, derivatives, and other types of investments - and try to make that money
make more money as fast as possible. Mutual funds, for instance, hire asset managers; so do
corporations with lots of money sitting around, banks, and high-net-worth individuals.
Asset managers have one simple goal: to invest other people's money wisely and profitably.
Asset managers use a combination of investment theory, quantitative tools, market
experience, research, and plain dumb luck to pick investments for their portfolios, ranging
from high-risk stocks to commercial real estate to cash accounts.
The profession requires excellent quantitative and analytical skills, organizational skills - and
nerve - to make split-second decisions with millions of rupees riding on the line.
As per our information, mutual funds typically recruit MBAs from premier campuses for
marketing and sales functions. (MOFS) For example, HSBC AMC visited MDI last year for this
kind of profile.
The very concept of a mutual fund is investors giving their money to professional &
experienced fund managers to invest. So in our information, mutual funds recruit people for
analyst / fund manager profiles from brokerage research houses, FIIs, bank treasuries and
other such organisations. So those looking at a longer term career with mutual funds or
pensions funds should target such recruitments.
AMCs
HSBC AMC
Kotak Mahindra Mutual Fund
Standard Chartered AMC
ABN AMRO AMC
Principal AMC
Birla SunLife AMC
DSP Merrill Lynch FM
Fidelity Fund Management
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Companies not exactly AMCs, but which do not fall under any other category
1 Temasek Holdings (Can be said to be a conglomerate but with a focus on

investments) (areas - investments, fin & acc, eq research, treasury, HR)
2 JP Morgan Chase (Financial Conglomerate)
3 Citigroup (Financial Conglomerate)
4 Stern Stewart & Co (Financial Consultants)
5 Metdist (Trading Company under Citibank UK) (seems to be one of those shady
companies that FMS has cracked!)
Hedge Funds
Gartmore (IIM Cal)

General Atlantic Partners (IIM Cal)
Other Important related Companies
1. Anand Rathi Securities

2. Motilal Securities
3. Kotak Securities
4. Avendus Advisors (I-Bank which has visited FMS, Bajaj last year!)
5. Indiabulls
6. Sharekhan
7. Darashaw
8. DSP ML GMI and DSP ML GPC
9. HSBC Securities & Capital Markets
10. JM Morgan Stanley
11. Rabo India Finance
12. Rabo Bank
13. Temasek Holdings (cracked by FMS)
14. ICICI Ventures
15. ICICI Securities
16. Sun Equity (IIMC)
17. Lazard India (Investment Bank)
18. Ambit Corporate Finance Pte.Ltd. (Investment Bank)
19. Kotak Mahindra Capital Company Limited (Investment Bank)
20. JP Morgan (Securities Trading)
21. AIG India (Insurance)
22. CitiFinancial Consumer Finance India Ltd ( Banking, retail loans)
23. ING Vysya Investment Banking (Investment Bank)
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Project Financing
Project finance is the financing of long-term infrastructure, industrial projects and public
services based upon a complex financial structure where project debt and equity used to
finance the project are paid back from the cash flow generated by the project rather than the
general assets or creditworthiness of the project owners. The financing is typically secured
by the project assets, including the revenue-producing contracts.
A Project is a scheme of finite set of tasks to be done in a specified period for deriving
expected benefits under certain assumed conditions. An industrial project is a scheduled set
of activities aimed towards the certain criterion of a particular asset as per planned
specifications, to generate wealth as estimated for the coming years.
However, a project is not strictly a private effort or event. It is not something that can be
done in isolation of the environment or society. Its a two way process, a give and take affair,
in as much as it draws on resources like technology, machines, finance, material from the
environment, converts raw material into some product or service relevant to the society and
returns it for appropriate price to the society.
When we consider project finance, there are different types of projects that would need
finance, which are as follows:
Modernization project
Expansion project
Diversification project
New/ Greenfield Project
Research & Development project
Backwardforward integration project
Captive Project
Ancillary Project
Characteristics of Infrastructure Project Financing:
Long Gestation Period

Uncertain Cash Flow
Negative Cash Flows in initial years
Cash Flow financing not necessarily asset based
Large and lumpy investments
Absence of full recourse financing
Lenders have to rely on:
o Long term contracts underlying project structure
o Government support for the project including guarantees
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INFRASTRUCTURE FINANCE
Infrastructure may be defined as services and facilities that support day to day economic
activity. Infrastructure includes roads, electricity, telephone service, and public
transportation. Infrastructure has traditionally been provided and maintained by the
government. However, most nations are currently experimenting with privatization of some
elements of the infrastructure as governments seek to cut their expenditures.
The Expert Group constituted by Government of India has identified six sectors under
infrastructure for commercialization. These are: Power, Telecom, Roads, Ports, Industrial
parks, and urban infrastructure.
In India there is an immense need of Infrastructure projects to take care of the basic facilities
needed for economic development. The country is advancing with a number of projects in
sectors like telecom, transportation, construction, power, ports, urban infrastructure, as well
as other basic facilities like schools and hospitals. The projects in these sectors are usually of
a long duration and require humungous investments. The size and duration of finance
requirement usually make it difficult to be procured by other normal financing companies or
banks. The expansion of infrastructure in the future cannot continue as it has been in the
past, based solely on public sector (government) due to a number of risks involved in it.. It
was imperative to bring in the private sector as a supplementary source as existing public
sector systems were unlikely to mobilize the resources needed. The Public Private
Participation (PPP) model can be seen to be used extensively these days.
The infrastructure requirements of the Asian region are very large and also increasing rapidly
because of high growth.
Typical job role of MBA Finance Students would involve:
- Knowledge of any particular sector (from the above mentioned sectors) (Very
Important)
- Knowledge of Financial Valuations/ Corporate Finance
- Portfolio Management
- Credit Analysis
IDFC
SBI Caps
L&T
IL&FS
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Real Estate
Introduction
As Indian is being slated to grow to become the third largest economy in the world, it is fast
emerging as one of most profitable investment locations among the emerging markets.
Capital markets have been the traditional investment avenues of both individual and
institutional investors.
A relatively new channel of earning lucrative returns and diversifying risk is Investments in
Real Estate. In the form of property developments in Commercial, Residential, or Retail
property markets, investments in real estate have are forming an increasing part of the
portfolios of investors.
Real estate service firms in India provide, broadly, five kinds of services:
1. Research and Consultancy: Example a MNC entering India may appoint a Global Real Estate
Service to advise on the location for their manufacturing facility taking into consideration
issues such as availability of state government incentives, cost of real estate availability of
manpower, quality of labour, educational facilities for children of expatriate managers, etc.
2. Valuations and due diligence: In an era of mergers and acquisitions, a substantial part of
the assets of the taken over firm are its real estate assets. The acquiring firm might want to
revalue and do a due diligence on the real estate that is has to pay for as a part of takeover.
3. Agency: Agency is a term for property broking and would involve: user representation
(tenant/purchaser), landlord representation (developer/individual landlord). Typically, it is
known as project marketing. Though majority of the agency's service is used by corporates,
individuals are also turning to professional firms for this service.
4. Project Management
Interior or (Fitout)
Building (Exterior)
If a client has acquired some space which it wants to convert into a running facility, the
project manager designs the facility, appoints the architects and contractors in consultation
with the client, supervises the work and does quantity surveying. The project manager's job
involves completing the project in time, within budgets and delivering the quality the clients
wants.
5. Facilities Management: Traditionally known as property management, this service entails

maintenance of the premises, provision of key services such as photocopying facilities,
cafeteria, car parking etc. Basically, providing everything that is needed to run the facility and
enhance the value of the premises along its life cycle. A fresh executive joining a global real
34
estate service provider firm would typically be provided with an initial orientation and then
learns on the job in a designated department which can be an agency or research or project
management. In a service business, and specifically real estate, one cannot exclude the two
activities of getting new business and servicing the business.
With their growth, these international property consultancies have started recruiting MBAs
from campuses or professionals from the services industry and have given them specialized
training. As they grow, these firms will need to recruit more and more professionals and,
unlike in the US or Europe, there are no specialized, recognized or accredited courses on real
estate in India.
Some institutes are seriously looking at introducing the subject in their curriculums. Also,
some of the business schools plan to introduce electives in real estate during the second
year, as the number of international property consultants visiting their campuses is
increasing.
Some of the topics which one should be aware of are
Legislation affecting real estate

Housing finance sector
General real estate scenario
Real estate financing
Quantity surveying
Land economy
Property management
Valuation
The key qualities
The five key qualities that a global real estate service provider firm would look for in a
prospective employee are:
Good communication skills, both written and conversational

Interest in real estate
Good number crunching skills
Service industry orientation
Integrity and ethics
If you fit the bill, there is excellent opportunity for MBAs in this sunrise industry.
35
Companies:
After economic liberalization, the real estate services sector has seen the entry of global real
estate service providers. Some of the examples can be:
1. Chesterton Meghraj
Chesterton Meghraj is India's leading international property consultant. Established in

1995, the company brought together the property expertise of the Chesterton
International Group and the financial asset management experience of the Meghraj
organization. The company has total staff strength of nearly 400. The company boasts of
many big clients.
http://www.bangaloreit.com/html/aboutbng/meghrajfrm.html
2. Colliers Jardine
3. CB Richard Ellis (CBRE)
CB Richard Ellis was the first independent international real estate consultancy to set up
offices in the Indian Sub-continent. Since its inception in New Delhi in 1994, the Indian
operations have grown to a network of offices in all major metropolitan cities, providing
services in the core areas of Strategic Consulting, Valuations/ Appraisals, Agency Services,
Asset Services and Project Management. Today, with over 550 professionals, CB Richard
Ellis South Asia is the leading reaal estate consultant in the Indian subcontinent.
http://www.cbreindia.com
4. Knight Frank
Knight Frank is a 105 years old property consultancy headquartered in London, with 136
offices worldwide.
5. Cushman & Wakefield

6. Le Salle Partners
7. Jones Lang Wootton
Jones Lang LaSalle is a leading global provider of integrated real estate and money
management services. They serve clients locally, regionally and globally from offices in
more than 100 markets on five continents. They have approximately 17,300 employees (
8,100 professional employees and 9,200 directly reimbursable property maintenance
employees).
http://www.joneslanglasalle.co.in
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8. ICICI PROPERTY SERVICES GROUP
ICICI Property Services are the Real estate Consulting arm of ICICI Bank HFC. It has
headquarters in Mumbai, offices spread over 40 cities, and about 225 markets across
India. The following services are offered by the PSG group are Agency Transactions,
Research and consulting and valuation, Real estate Investments, Rent Securitization and
Joint Venture Securitization.
The remuneration in global real estate service firms is as good as and even betters those
firms in other service industries because of incentives apart from the salary.
The MNCs are coming to India as India is an untapped market and has few players in this
field. Moreover, global companies are setting up operations in India and real estate is a
profitable business.
37
Securities sales and trading
Introduction
Securities sales and trading is an extension of the investment banking industry. An

investment bank relies on its sales department to sell bonds or shares of stock in companies
it underwrites.
Most investors, whether they are individuals with a few hundred dollars to invest or large
institutions with millions, use securities sales representatives when buying or selling stocks,
bonds, shares in mutual funds, insurance annuities, or other financial products. Securities
sales representatives often are called stock brokers, registered representatives, or account
executives.
It could primarily involve two kinds of functions:
1. Institutional Sales
The company here is an active underwriter and dealer in fixed income

securities, including corporate bonds, government bonds, and money market
instruments. An individual doing a job here would be required to do Analytics to
maintain profitable trading.
2. Personal Investment Sales/ Full Service Brokerage
The Company could also provide access to a variety of investment products

through a full service brokerage capability to high net worth individuals seeking
superior investment performance. People who invest in securities must use licensed
brokerage or financial firms that advise them and handle the actual trading and
investing for them.
3. Consulting for Securities Investments
In this function an individual is required to offer investment advice to

institutional investors or high net worth individuals. They may explain stock market
terms and trading practices, offer financial counseling or advice on the purchase or
sale of particular securities, and design an individual clients financial portfolio, which
could include securities, life insurance, corporate and municipal bonds, mutual funds,
certificates of deposit, annuities, and other investments.
38
Securities sales and trading are high profile, high-pressure roles in the investment
banking industry. Unlike other I-banking careers, such as corporate finance, public finance,
and M&A, where the emphasis is on the team, securities salespeople and traders are
independent, working on commission to bring to market the financial products that others
create.
The most important part of a sales representatives job is finding clients and building a
customer base. Thus, beginning securities and commodities sales agents spend much of their
time searching for customers. They also may meet clients through business and social
contacts.
A fresh MBAs job role could be:
Associate Relationship Manager - Acquiring new clients and advising HNIs on their
long term and short term investments and maintaining relationships with them
Equity analyst
Equity Dealer - Will be responsible for acquiring clients and managing their portfolio
by assessing their needs and advising them on their Investments, based on the
research reports generated by the research department
Commodity dealer - Will be responsible for managing the portfolio of clients
interested in investing in commodities by assessing their needs and advising them on
their Investments, based on the research reports generated by the research
department
For instance, a fresh MBA finance graduate would be required to analyze fundamentals of a
particular commodity by researching which includes valuation on the basis of supply and
demand, and the research would be as in depth as to keep track of the wholesale market for
commodities.

With a growth in this sector, these companies are seriously looking at fresh MBAs for mostly
analytical work. However, for Sales function they require experienced people from related
fields.
Desired Knowledge
The Candidate should have good knowledge of Finance. Also professional qualification in
Securities trading would be helpful. NCFM certification in this regard may do the needful.
Some Important Companies
DSP Merrill Lynch
Indirect Sales: http://www.dspml.com/gmi-sales.html
DSPML has an unparalleled distribution network comprising approximately 4,500 distributors

National & Regional Alliance Partners spread across India. Being one of the leading
39
underwriters of both debt and equity, we are poised to offer top-grade primary products to
our distribution channel. Over the years, we have emerged as a leading distributor of mutual
fund products. We are in a position to provide one of the widest ranges of quality products
and services to our sub-brokers:
Mutual Funds
Bonds
Fixed Deposits
Equity IPO
Karvy Consultants
KARVY, is a premier integrated financial services provider, and ranked among the top five in
the country in all its business segments, services over 16 million individual investors in various
capacities, and provides investor services to over 300 corporates, comprising the who is who
of Corporate India. KARVY covers the entire spectrum of financial services such as Stock
broking, Depository Participants, Distribution of financial products - mutual funds, bonds,
fixed deposit, equities, Insurance Broking, Commodities Broking, Personal Finance Advisory
Services, Merchant Banking & Corporate Finance, placement of equity, IPOs, among others.
Karvy has a professional management team and ranks among the best in technology,
operations and research of various industrial segments.
This company does not come to campuses.
Kotak Mahindra
Kotak Securities Ltd is also a depository participant with National Securities Depository
Limited (NSDL) and Central Depository Services Limited (CDSL) providing dual benefit
services wherein the investors can use the brokerage services of the company for executing
the transactions and the depository services for settling them.
HSBC India
HSBC Securities Services is a part of the Corporate, Investment Banking and Markets
business of the HSBC Group, offering a wide range of support services to corporate and
institutional clients including.
SBI Caps
SBI Capital Markets Limited is a member of the National Stock Exchange of India Ltd. in the
Capital Markets as well as the Wholesale Debt Market segment and is also a member of The
Stock Exchange, Mumbai in the Capital Markets segment.
40
The Broking Group has been set up to cater to the secondary market needs of Financial
Institutions, Foreign Institutional Investors, Mutual Funds, Banks, Corporate's, High Net
Worth Individuals, Non resident Investors and retail investors.
Services Currently Offered:-
Institutions Only
1) Equity Broking
2) Debt Broking
Services envisaged in future:-
1) Derivatives Broking
2) E-Broking
3) Equity /Debt for HNI, Corporate's, Retail
41
Private Equity
Private Equity Industry Structure
The private equity industry is generally composed of four major types of investors:
Venture Capital
Leveraged Buyout
Mezzanine, and
Secondaries / Funds of Funds investors.
Venture Capital
A venture capital fund invests in early stage companies in need of capital for growth. Such an
equity investment is often structured as a preferred stock security. It is rare for a venture
capitalist to structure an investment in an early stage company as a straight debt instrument,
as the startup with unproven products and cash flow constraints would be unable to make
the interest payments. Venture capitalists will usually take a minority, non-controlling stake in
the company and may often syndicate the risk of the investment among a number of firms.
Venture capital investments typically proceed according to a number of different stages. A
pure startup company will obtain its initial financing through a seed round. This round may
be far less than $1 million in size, and may not even be sourced from a venture capitalist but
rather from an angel investor. An angel investor is a wealthy individual, acting alone or in a
group, that makes small investments of his or her own personal capital in early stage
companies. If the seed round is successful, the company will often require several rounds of
venture financing before the investors are able to exit their investment through an initial
public offering (IPO) or, more commonly, a sale to a strategic investor.
Leveraged Buyout
A company entering into an LBO is typically a mature but underperforming entity with a
proven product and stable cash flows. Often, an LBO candidate is a subsidiary of a larger
company that has been underperforming or has become nonessential to the parent
companys operations. An LBO fund is unlikely to undertake a transaction with a high growth
technology company due to its unpredictable cash flows. Cash flow is essential to make
interest payments on debt. Unlike a venture capitalist, an LBO investor will typically take a
control position in the company, investing equity and structuring a combination of loans
from various lending sources. In analyzing a transaction, the LBO investor will typically value
a business based on a certain multiple of its EBITDA (Earnings before Interest, Taxes,
Depreciation and Amortization). The debt used in the transaction will be raised from the
public and/or private markets through the issuance of high yield bonds and the commitments
of commercial banks and other institutional lenders. The percentage of equity used in a
transaction will vary depending on the investment climate and the projected cash flow of the
company compared to its debt payments. Once the transaction has closed, the LBO firm will
seek to improve the companys internal processes and structure so as to maximize its free
42
cash flow available for interest payments and investments in growth projects. Once value has
been created, typical exits include IPO, sale to a strategic buyer or sale to another LBO fund.
Mezzanine
A mezzanine investor is somewhat different from other direct private equity financiers due
to its preference for investments in debt-like securities. A mezzanine investor receives
securities which have greater seniority than equity in a companys capital structure, typically
at the subordinated debt level. Such securities may feature an accumulating or current pay
dividend and will often include equity warrants. Due to its lower risk tolerance and
investment in less risky securities, the mezzanine investor typically receives a lower return
than other private equity investors. These funds ability to generate returns are somewhat
dependent on the IPO market since mezzanine financing is typically used to bridge the
financing gap from the time a firm decides to issue public securities to when it is actually able
to execute the sale of these securities. Recently, mezzanine funds have gained popularity
and multi-billion funds have been raised.
Secondaries / Fund of Funds

A secondaries fund is different from other private equity vehicles in that it does not invest
directly in operating companies. Rather, it purchases interests in existing private equity
funds, often at deep discounts, from limited partners who choose to monetize their
investment before the typical 10-year period of a partnership has been completed. Similarly, a
fund of funds investor is an asset manager that allocates capital among a number of private
equity funds, including both venture and LBO funds. Through this approach, the fund of
funds manager offers diversification and expertise to certain types of limited partners, such
as small endowments and foundations that do not have the staff to manage the investment
process effectively.
Roles within PE Firms
For a candidate, this list is a starting point in understanding the organizational structure of
private equity firms. Titles and responsibilities vary significantly based on firm size,
investment focus, and geographic location, among other factors.
43
The Associate Role
Since most MBA students will be seeking a position as an Associate, most of this note is
focused on describing an Associates tasks, what the Associate title means, how this role is
changing, how an Associate develops a career, and the challenges for MBA students seeking
an Associate position.
Tasks and Activities: A successful Associate candidate must have a diverse skill set, as he or
she will be called upon to participate in all phases of deal making and possibly in operations
and fundraising. The three main abilities required are: technical skills to understand the
industries in which the firm invests, analytical skills to assess investment opportunities, and
interpersonal skills needed to build a strong network which will be a major resource
throughout his/her career.
Technical skills firms tend to target their investments in specific sectors or domains.
Much of the Associates job is focused on gaining expertise in a firms specific domain
(if he/she does not have previous experience in this sector).
Analytical Skills These skills are largely acquired through work experience in
finance, consulting or similar positions as well as an MBA education. The Associate
must be able to understand business models in detail, produce relevant research on
market trends, competitor products and customer profiles, and also be able to
support an investment thesis for the specific industry sector or market. This involves
due diligence such as visiting the company, speaking with customers, suppliers and
competitors, and modeling the financials to determine the companys valuation.
Interpersonal Skills These skills will obviously be important for general success
within a firm, but interpersonal skills are essential for establishing the network of
contacts that will support the Associate throughout his/her career. Networking
activities should seek to build two types of contacts:
o Contacts that will provide deal flow these will include other investors,
service providers such as lawyers and bankers, trade groups, and
entrepreneurs.
o Contacts that have access to individuals with managerial capabilities these
will include entrepreneurs, industry executives and possibly management
consultants.
Associates must have the ability to process various kinds of data, interpret the data
effectively and reach a conclusion. The Associate must absorb a lot of information, determine
trends and key issues, and then tactfully raise and address these points with investment
decision makers in the firm. Associates should expect to be judged on how well they are able
to assess the key factors of a deal, whether they make the right recommendation about the
deal and how fast they reach a decision. Beyond execution, relationship building is extremely
important for Associates and is essential to their long term career success.
44
The following exhibit details the responsibilities of an associate:
Chrysalis Capital
ICICI Ventures
Avigo Corp. Dubai
Indocean Chase Capital
Sabre Capital
DLJ Alliance
Walden International
SUN Group
45
Insurance
Introduction
In India, the concept of insurance was never a given a serious thought, as compared to other
countries. People still are under insured, life insurance premia to Gross Domestic Product
(GDP) ratio is a mere 1.4% as compared to a healthier rate of 8% amongst other developing
countries. The reason being lack of awareness and opportunities combined with poor state
of services provided.
Presently in India, the insurance sector is nationalised, services are rendered by Life
Insurance Corporation of India (LIC) and General Insurance Company (GIC) alongwith its 4
subsidiaries. While LIC provides life insurance, GIC is concerned with non life insurance like -
motor, marine, fire, health and personal accident insurance. LIC employs people in various
departments - publicity and public relation department, development department, personnel
department, accounts department, actuarial department, secretrarial department, legal
department, investment department, inspection department, mortagages department,
vigilance department, foreign department, corporate planning department, building
department etc.
Of late, parliament's nod for the Insurance Regulatory and Development Authority (IRDA) bill
has changed the whole scenario. With the passage of the bill, entry of private indian as well
as foreign companies, alongwith existing players, in the insurance sector will add variety and
quality to the present insurance services. The other positive impact would be on creation of
new employment opportunities. Till now employment in the insurance sector was considered
akin to any government job, but now with private participation, it will assume significant
importance and probably become an exciting career option.
Career Prospects for MBAs
Apart from career opportunities available with LIC and GIC, employment avenues are also
open in corporate sector, stock broking firms, finance companies, shipping companies etc.
ACTUARIAL: An actuary holds one of the most important positions in an insurance business.
He is involved in solving wide range of financial problems related with insurance investments,
financial planning and management. Graduates in maths or satistics are suited for this kind of
a job because the work is based on mathematical and statistical skills. In the coming times it
will definitely make one of the highly paid career option in the insurance sector.
UNDERWRITING: The life and non-life insurance segments require professional underwriters.
Underwriters assess the risk in the business and takes care of risk management. Normally
foreign insurers prefer people with medical or life science background for this job and the
same is likely to happen here
MARKETING AND DISTRIBUTION: Marketing insurance product is not easy at all. It is like
marketing any other financial product, which requires a push. Marketing therefore would
46
require specialization. Degree holders from reputed institutes and those with experience in
marketing and finance fields can anticipate bright opportunuties in the insurance sector.
Even the role of agents will witness a radical change, they will moreover serve as financial
consultants, who will offer a complete range of insurance solutions.
OPERATIONS: The insurance sector will be requiring Infotech professionals for elaborate
databases, network solutions and for in house packages etc. Like other sectors, demand for
database and software professionals is expected to grow in the insurance sector as well.
INVESTMENT: Like banks and mutual funds, investment professionals will be required in
insurance sector as well. Professionals with degree in finance from reputed institutes as well
as experienced professionals from banks and mutual funds will have promising career
options to look forward to.
MORE ON THE ACTURIAL JOB:
Actuaries are the forecasters for the insurance industry. Actuaries research, assemble, and
analyze data to estimate probabilities of death, sickness, injury, disability, retirement income
level, property loss, or return on investments. They estimate how much an insurance
company will have to pay out in claims, answer questions about future risk, make pricing
decisions, and formulate investment strategies. Some actuaries design insurance, financial,
and pension plans and ensure that these plans are maintained on a sound financial basis.
Most choose a specialty: life, health, or property and casualty insurance, or pension plans.
Actuaries in executive positions help determine company policy. An actuary may be needed
to explain complex technical matters to other company executives, government officials,
shareholders, policyholders, and the public in general. They may be called upon to testify
before public agencies on proposed legislation affecting their businesses or explain changes
in contract provisions to customers. They also may help their employers develop plans to
enter new lines of business.
A growing number of actuaries work in the financial services industry, where they manage
credit, prepayment, and other risks, and help price corporate securities offerings. A
consulting actuary offers advice to clientsinsurance companies, corporations, hospitals,
labor unions, the governmentfor a fee. Consulting actuaries provide advice to various
clients on a fee basis. Some consultants design pension and welfare plans, calculate future
benefits, and determine the amount of employer contributions. Others provide advice to
health care plans or financial services firms. Consultants may be called as expert witnesses in
court regarding the value of potential lifetime earnings lost by a person who has been
disabled or killed in an accident, the current value of future pension benefits in divorce cases,
or the calculation of insurance rates.
47
The key qualifications/skills for the Actuarial job:
The key qualities that a global real estate service provider firm would look for in a
prospective employee are:
Strong background in mathematics - working knowledge of calculus, probability, and

statistics
Courses in economics, accounting, computer science, and insurance
Individuals who are well rounded, with courses in liberal arts and business, but also
have a strong technical training are preferred by employers.
Good communication and interpersonal skills
Well informed about general economic and social trends and legislation, as well as
developments in health, business, finance, and economics that may affect insurance
or investment practices.
Types of employers
Banking (Commercial)
Communication Services (Broadcasting & Telecommunications)
Consulting Services (Management)
Financial Services (Securities, Commodity Contracts, & Other Financial Investments)
Insurance Carriers & Related Activities
Transportation Equipment
Utilities.
Royal Sundaram
AON Global Services
Cholamandalam
ICICI Lombard General Insurance Company Ltd.
ICICI Prudential Life
Tata AIG
SBI Life
Bajaj Allianz
48

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Career Profiles in Finance

Analytics can progress along two lines:

Identifying prospects most likely to respond to a companys service offerings by

Revenue Generating Activities:

Cost cutting Activities:

Insurance Scoring: Developing models to predict the likelihood of occurrence of claims

Claims Analysis: Modeling for frequency and severity of claims leading to

Underwriting Automation: Improving the efficiency of processes by automating decision

Customer Acquisition & Servicing: Maximizing returns on marketing expenditures through

Why and How to proceed?

As the relationship between a customer and a banking/financial services provider changes

Commercial banks vs. Investment banks

A commercial bank can be a retail bank, or a wholesale bank, or both.

Head of Retail Banking

Product Head Product Head Product Head

Product Manager (PM) Retail (PM) Car

(PM) (PM) Private (PM)

(PM) Forex (PM) Internet (PM) Credit

(PM) RBI GOI (PM) Salary (PM) Personal

Zonal or Regional Product Managers / Sales Managers for

Branch Level Relationship Managers / Sales Managers / (Officers)

Job Profiles/ Responsibilities:

1. Product management: Corresponding responsibilities might include:

2. Relationship management: Involves Maintaining relationships with business entities,

6. Business Development Manager: In some banks, this designation is same as Product

The following features distinguish wholesale banking from retail banking:

Matching & Liquidity in wholesale banking

Treasury management in Banks

Job Profiles that are offered in treasury

What does a career in this sector entail?

The area entails several jobs some of which are:-

1. Providing new services and products by different banks

2. Funding of companies operations and source of funds

Business acquisition or sale

The due diligence is required by investors, lenders, businesses involved in a purchase or

7. Mergers and acquisition

8. Advising on Selling a Business

Careers for fresh MBAs

Some of the topics which one should be aware of are:-

Basics of commercial accounting and balance sheets

The key qualities

An excellent problem solver

Due diligence services

Sector Outline and Nature of Services provided:

An Investment Bank usually provides the following services to its clients:

Advisory (M & A and Industry Teams):

Debt Capital Markets:

Equity Capital Markets:

Banque Nationale de Paris

The main responsibilities of the Analyst can be summarized are as follows:

Careers for fresh MBAs

1 Temasek Holdings (Can be said to be a conglomerate but with a focus on

Gartmore (IIM Cal)

Other Important related Companies

1. Anand Rathi Securities

Characteristics of Infrastructure Project Financing:

Long Gestation Period

Typical job role of MBA Finance Students would involve:

What does a career in this sector entail?

5. Facilities Management: Traditionally known as property management, this service entails

Careers for fresh MBAs

Some of the topics which one should be aware of are