Choosing the Best Investment Banking Courses in India
“Morgan Stanley offers $200,000 to IIM student for Investment Banking role!” reads a newspaper article. What is Investment Banking (familiarly called ‘I-banking’), and why is it so ‘hot’??
Lots of people think, given the name, that I-banking means to manage the investments of clients. Not so! Investment banking, firstly, is a service offered to a business, not an individual. Secondly, it is to do with raising funds for the business, not investing it.
Also, since this is a pure Advisory service, any one – not just a bank – can offer ‘I banking’. You have a 1-2 people firms to large multinationals such as Goldman Sachs.
The two main businesses of I-banking are:
1. Merchant Banking or Issue Management
2. Mergers and Acquisitions
Merchant Banking or Issue Management, is the Advisory service offered to companies, helping them with raising funds in the financial markets. You will have heard of an Initial Public Offering, or IPO, when a company is offering its shares to the public, for the first time. A Merchant Banker will be advising the company throughout the process.
Mergers & Acquisitions, also called M&A, is the more glamorous I banking service. Here, an Investment Banker advises companies which are either buying other companies or being bought themselves.
For example, when Crisil recently bought Pragmatix Services, for about USD 8.5 Mn, both parties would have hired an I banker ; who would charge a fee, which is a percentage (2-3%, usually) of the deal value.
Another type of I banking service gaining popularity is Venture Capital & Private Equity (PE) funding. Here, a fund invests in a company, by buying some of its shares. VC funds invest in established startups, while PE funds in mature companies. People working in such funds, are also called ‘I bankers’.
Now that we understand what I banking is , let us see, what are the entry level roles and what courses, will prepare us for them.
It is important to understand that, I banking front office firms hire very few people, as the requirement is small. The other option is, to join a KPO. Such a company does the initial research required, for its parent firm.
For example, a Goldman Sachs KPO in India, will handle all the initial work such as preparing Excel models, Powerpoint presentations, initial data base research for possible acquirers/ acquirees, for Goldman Sachs, globally. These KPOs hire in larger numbers and are easier to get into.
The entry level role is that of an ‘Analyst’, whether you are joining an Ibanking front office or a KPO. You will remain there, for 3-5 years. The big pay however, happens in the front office firms – that is, the main I banking business. The bonuses made by the team are spread around generously in this small team, that’s why it’s ‘hot’.
In either case, the competition to get in, is fierce! Only the ones who show a genuine interest in investment banking certification, along with some initiative and relevant skills, stand a chance.
That’s where a good course plays a role. This course should give you the required knowledge; as well as display the interest and initiative you have. It should lead on to a recognized certification, which will help your CV stand out.
Here, we are talking about value added courses. That is, those which add value to your basic qualification – which ideally, should be a good MBA.
You have two choices for such Investment Banking courses– either go for a classroom course, or an online course. Let us understand how to choose between them:
§ Classroom courses depend highly on the quality of faculty. You must therefore, check the faculty background.
§ They are also available in the big cities only – usually Mumbai and Delhi.
§ Such courses are pretty expensive! The fees range from Rs. 1.5 – Rs. 2 lakh, for a 4-6week course.
So, if you have the time and the money to invest, and are based in one of the big metros, then this can be an option. To choose, check the faculty quality and reviews, carefully. Look at the alumni profiles and if possible, reach out to them on LinkedIn, to understand the pros and cons.
One of the popular ones , is The Wall street school in Delhi – charges Rs. 1.25 lakh, for a 6 week course; and of course, it is based in Delhi. It has good reviews and offers placement assistance. However, there is no recognised certification that it offers.
What about online options?
§ These are usually much less expensive and can be taken from anywhere.
§ However, online courses are tough to complete, if you get stuck at any point. Look for those which offer offline support – such as online faculty sessions, or email queries
§ Check out for the faculty, who has designed the course. They need to have the relevant experience. This will guide the quality of the course
§ Of course, a good certification is a must.
Given the above, here are the most popular ones:
1. NCFM certifications, offered by the National Stock Exchange are easy to clear and cost ~ Rs. 1700 only. You download a pdf, look at the sample question paper, and write the certification exam. They have one on Mergers & Acquisitions. National Stock Exchange of India Ltd. Here, the learning you get, is limited to the pdf.
2. FLIP Certifications are growing in popularity and are the choice of thousands of B schoolers. They are very practical – their online course on Private Equity, M&A, is developed by a senior IIM alumnus working in an American PE firm. After completing the detailed online course, you can write their certification exam. They’re not as easy to clear, and the cost will be Rs. 8–10,000 inclusive of the online learning and the testing fee. This possibly will help you more in actual interviews and job situation.
