krishsuraj

@krishsuraj

Apurv
Apurv Pandit @Apurv
[image]What the IIMs never revealed in their press releases, a question in the parliament unearthed. In a written reply to a question posed in Rajya Sabha today, the Union Human Resources Development Minister Kapil Sibal said that only 497 students were recruited from all the six IIMs by multinat...
krishsuraj
Suraj Krishnaswamy @krishsuraj
Not only IIMs, no B-School(at least in India) trains you for working in Start ups. MBA degree by itself reduces your appetite for risk taking. That said, many of my batch mates have started their own companies after signing out of placements. When I asked why did they opt for an MBA, one of them quipped "People listen to me when I same I'm an IIM grad, its just the credibility factor! Besides if something goes wrong, I can always bank on the IIM degree to get me a good job"
Was a great meet indeed, especially meeting the PG HQ guys and some of the oldies, and of course, the snacks, the pizzas and the gossips!

Didn't know PG HQ had an amazing band; they really made the evening a memorable one.And perhaps for the first time, there were more MBA grads/alumni than aspirants in a PG meet.

Overall the meet rocked...
  • 4 Likes  
Sounds like it will be fun... I will also try to make it.
@Navneet023, include me in your PM list...
  • 7 Likes  
Perception cannot be changed, at least in campuses people were terrified of IBDs and most of them preferred to go to trading instead. I have never heard horror stories in S&T;, at least they havent been documented well. On the other hand, blogs like www.leveragedsellout.com and Understanding Investment Banking | Mergers & Inquisitions recount IBD horror stories..
And regarding the timeframe, 45 days is a very typical timeframe from getting the mandate to at least taking the deal to PEs, without counting the time for pitching of course!!!!!
Lets talk about numbers, a big I bank executes around 178-190 deals in a fiscal year (example - JPMorgan Chase, Bank of America), among these many deals, 30-32 deals are M&A;, probably 15-16 are LBOs /MBOs, given that - I understand a person involved in 16 odd deals need to grind for 15 hours for a couple of months, however on an average there is no single team in I banking section, which spends 15 hours for whole 6 months - leave alone 12 months for the time being. For relationship deals, same person will spend probably just 3 hours and that too bank meeting. Just to point these numbers (178-190) is for big I bank - small I banks get to execute 50-55 deals in an year! (probably even less or more, this could be a good average)


The number of closed deals have certainly come down, but there is one difference. The number of unsuccessful deals have been very high especially in private placements and other such dealings with the PEs. Promoters not able to raise money through IPOs, go to PEs. For the uninitiated, this is how it typically works
Make a pitch, get the mandate, talk to the company and its employees ( which takes about 20 days including plant visits and others), make the financial model ( make the promoter understand that the valuation he is seeking is too aggressive and its not possible in this market), make the information memorandum, send it to 10-15 PEs ( of which only 1-2 would want to take it forward) and initiate the deal. This process easily takes about 40-45 days during which you are normally required to put a lot of '15+ hr days'. If the deal falls through, which is highly probable ( 2-3 in 10 is the current ratio), none of this even appears in the number of deals the company has done during the year. So lets just not go by number of deals. Ya working hours are not as long as it was during last year, but IBD has certainly not become a '9-5' job. There are people in IPO execution and ECM teams who are absolutely jobless, but they certainly are not representative of the majority
If I may still choose to disagree actually trade and sales units in an ibank are called as investment bankers. Commercial and corporate banks also have a sales and trading unit, and likewise they cannot be termed as ibankers. But, in an ibank, all sales and trade people are definitely called investment bankers. Hope this helps.

cheers,

-awr

Yes Sales & Trading and IBD(IPOs, M&As;) both come under an I-Bank, but not every one who works in an I-Bank is called an I-Banker. The term 'I-banker' or more commonly a 'banker', is reserved only for the IBD people.
So if you are working in S&T;, you can say that you work in an I-Bank but you normally dont call yourself an I-banker!
And regarding work hours, its an accepted fact that S&T; people work less hours than people in IBD. But S&T; people hardly get time to go off their seat even for their lunch while in IBD, people do have that comfort. So as far as intensity is concerned, both are as tiring
  • 2 Likes  
@anandv - I didnt forget Edelweiss, they are very small in Indian I-Banking space, they r decently sized on the trading side.... I did miss one Indian IB though, DSP ML, but only 5% stake is with the Indian partner now!!!!!
  • 3 Likes  
Jackal Says
aah i forgot about the indian investment banks.. they are bigger than the indian arms of global IBs.. but if you look at the volume of business in India and the no. of employees in Indian IBs and no. of employees in firang IBs working on Indian investments.. dont u think the no.s are way too small and insignificant.. In fact if you look at the work outsourced by global banks (read KPOs both captive and 3rd party) it's a lot more.. i dont have figures to substantiate this but correct me if i am wrong..


Ya KPOs of IBs are bigger in size in India but work is being outsourced from all over the world to India. Comparing them wont be right.
Is the Indian IB industry small? I would say Yes.
Insignificant? No way!!!!

M&A; deal sizes are small and are mostly run by foreign IBs, especially the cross border ones. In IPO, undoubtedly Indian firms are kings - especially Enam, JM & Kotak. With so many PE firms coming into India for investing and many of them raising India specific funds, the activity in this area is pretty much there. Even in this lean season, my team managed to close 5 deals in the past month and most IBs are doing decently well in this front. With IPO not an option now, private placements are booming as the promoter needs to raise capital from somewhere now. Though bonuses are expected to be low this year, the IPO market is expected to pick up by November.


@suraj: well abt the Mck recruitment thing.. i have heard different views on this.. how many of those 50 are for the knowledge center??



47 of those recruited are from the IIMs and ISB ( My roomies work there and hence the exact figure ). They dont recruit for Mck Knowledge center from these colleges. In Fact, all the 50 ppl have joined Mck, India. Some were even recruited for Mck, NY/London/Brussels etc.. from the IIMs. I guess put together the figure was around 70!!!!!
  • 3 Likes  
@ Jackal
Indian I-Banking scene is not as big as US or EU but still it isnt small too. There are many Indian IBs like Kotak, Enam, JM & Avendus which have a nearly 100 strong IB team, though Indian arms of foreign IBs r still very small. Even in the bear market they recruited pretty agressively this year from the B-School campuses.
And regarding consulting, Mck - India has hired 50 new MBA grads for India this year!!!!!!
  • 3 Likes  
@Babu

Normally even from IITs, bulk of the ppl are hired for back-end and 1-2 for front end. It just might be the case that they have done that in SRCC too. But I'm sure bulk of the hired ppl r in KPO only as Lehman's Investment Banking team size is extremely small in India.
Coming to salaries, a newly hired MBA grad in Lehman front office gets about 8000-10000 USD per month working in Mumbai apart from the bonuses, which can shoot your net to anywhere around 1.5 crores. I personally know a guy who got this much money in Lehman about a year back when the going was good. So a net pay of 14L including bonuses for an analyst is still cost savings for Lehman
  • 4 Likes