What Roles Do Investment Banking Companies Play in India?

1. What Roles Do Investment Banking Companies Play in India? It is very important to play smart when it comes to investment. You can’t just invest for the sake of it. The investment you make as a business or as an individual, needs to give you good amount of returns when you must redeem it. For bigger businesses, it is suggested to seek advice from fund management companies regarding the same. We are not saying that you are not capable of doing that on your own, however, having a professional consultation always helps the business investment to grow in a steady and wise manner. The fund manager assigned to you will advise you on the types of funds you should invest in and take care and manage the funds later. They monitor the growth and decline of different investments and in case they notice that a specific type is not very fruitful to their client, they advise to immediately retract funds from that investment. Also, along with that, they help you in identifying different paths in which you can invest those funds again. You can find fund management companies in your city, otherwise, investment banking companies in India or anywhere around the world also perform the function of fund management for their customers. However, investment banking falls under different category. In investment banking, the investment banks help their HNI customers or business clients raise funds through various mediums or provide them advisory services on these matters. They are like the middlemen between the issuers of securities and investors and help the big growing companies go public. It also includes doing activities such as underwriting new debt for any type of corporations, aid in mergers and acquisitions and help in reorganisations. But how do investment banks gain from all this? How do they earn? Well, they earn from the profit made by the client. They usually sign a contract and get commission based on the profits that are earned by the clients and the investors. In recent times, the investment banking companies have started to advice their clients on the ESG funds. ESG funds are basically funds that are contributed towards the Environmental, Social and Governance factors of running a business. To put it in simple words, these are the funds that highly functioning companies need to invest in, internally for better performance and to raise goodwill. It is very different from CSR (Corporate Social Responsibility). Corporate Social Responsibility is more about giving it back to the society we are living in and performing good deeds on behalf of the company. ESG funds deal with ensuring that the factors that contribute to smooth running of the business are taken care of in a way that they are happy and contended. This is applicable mainly in the social factor of ESG. In environmental factor, the company needs to invest in making the workspace eco-friendly and ensure that none of its actions have any adverse effects on the environment. In governance, most of it depends on the legal formalities that the company needs to follow. www.avendus.com