mbd induction - latest
TRANSCRIPT
-
7/30/2019 Mbd Induction - Latest
1/28
Karvy Investor Services Ltd.
Welcomes You
-
7/30/2019 Mbd Induction - Latest
2/28
Organization Life Cycle
-
7/30/2019 Mbd Induction - Latest
3/28
Structure of the Securities Market
CAPITAL
MARKET
BUYING / SELLING
MARKET REGULATOR
(SEBI)SROs
AMBI
AMFI
MARKET
INTERMEDIARIESInvestment
Bankers
R&T
Agents
Mutual
FundsStock
EcxhangesBrokers
Under-
writers
Investment
Analyssts
Portfolio
Managers
RAIN
-
7/30/2019 Mbd Induction - Latest
4/28
Who is a Merchant Banker?
Securities & Exchange Board of India (Merchant Bankers) Rules, 1992defines a Merchant banker as
Any person who is involved in managing issues
Buys, sells or subscribes to securities as manager
Renders corporate advisory service in relation to issue management
,restructuring, buybacks, delisting, takeovers, ESOPS and the list goes on.
-
7/30/2019 Mbd Induction - Latest
5/28
Karvy MBDRange of Services
Capital Issues
Value Added Services
Restructuring
Mergers, Amalgamations
Private Placement
Merchant
Banker
-
7/30/2019 Mbd Induction - Latest
6/28
Relationships of Merchant Banker
MERCHANT
BANKER
INTERMEDIARIES
ISSUER INVESTOR
SEBI
Capital
Market
Information
ComplianceRegulation
Disclosures
Guidance Co-ordination
Quality Issues
-
7/30/2019 Mbd Induction - Latest
7/28
Intermediaries and Legal StructureBook Built IPO
Intermediaries
Complex Legal Structure of a Book Built Offer
EscrowBankers
EscrowBankers
Syndicate MembersSyndicate Members
DomesticLegal
Counsel
DomesticLegal
Counsel
BRLMCo -BookRunners
BRLMCo -BookRunners
Book Runners
Legal Counsel
Book Runners
Legal Counsel
International Legal
Counsel
International Legal
CounselRegistrarsRegistrars PrintersPrinters
IssuerCompany /
SellingShareholder
IssuerCompany /
SellingShareholder
Arrangement
Co - ordination
AdvertisingAgency
AdvertisingAgency
EscrowBankers
EscrowBankers
Syndicate MembersBroker/ Syndicate
DomesticLegal
Counsel
DomesticLegal
Counsel
BRLMCo -BookRunners
BRLMCo -BookRunners
Book Runners
Legal Counsel
Book Runners
Legal Counsel
International Legal
Counsel
International Legal
CounselRegistrarsRegistrars PrintersPrinters
IssuerCompany /
SellingShareholder
IssuerCompany /
SellingShareholder
Arrangement
Co - ordination
Arrangement
Co - ordination
AdvertisingAgency
AdvertisingAgency
SyndicateAgreement
IssuerIssuer
Company /Company /
SellingSelling
ShareholderShareholder
OfferorsPoA
Book RunnersMoU
ListingAgreements
InternationalWrap
Registrars
MoU
UnderwritingAgreement
Prospectus
Software usageagreements with
StockExchanges
Depository 3 -party
agreements
Red HerringProspectus
EscrowAgreementCAN
SyndicateAgreement
IssuerIssuer
Company /Company /
SellingSelling
ShareholderShareholder
OfferorsPoA
Book RunnersMoU
ListingAgreements
InternationalWrap
Registrars
MoU
UnderwritingAgreement
Prospectus
Software usageagreements with
StockExchanges
Depository 3 -party
agreements
Red HerringProspectus
EscrowAgreementCAN
-
7/30/2019 Mbd Induction - Latest
8/28
Finalizing Basis of
Allotment
Documentation withdepositories
Credit into investor
accounts
Listing approvals fromthe stock exchanges
Post issue research
support
Merchant Bankers Span of Work
Due Diligence
Preparation ofProspectus
Arranging FirmAllotments
Statutory approvals
Appointingagencies
Marketing strategy
Press and Brokerconferences
IPO Funding
Printing andDistribution ofstationery
Road shows
Press
Brokers
InstitutionalInvestors
Retail Investors
One to One meets
Research Reports
Analyst meets
NRI Investors
PRE ISSUE MARKETING POST ISSUE
-
7/30/2019 Mbd Induction - Latest
9/28
Marketing Strategy
Broker and Press conferences in key citiesAdvertising and Public Relations campaign
Management interviews in print & electronic media
Initial contact with High Net Worth Individuals (HNI)
by Private Client Services (PCS) sales personKey HNI meet with the management
Collate pre-marketing feedback and decide floor price
Finalize the management road show schedule tomaximise investor coverage across investor
geographiesOne-on-one meetings and group functions with
company management video / telephoneconferences in secondary cities as needed
Regular interface by salespersons with fund managersto follow-up for bids
Qualified
Institutional Buyers
60%
High net worth
individuals
25%
Retail
15%
Strategy
Strategy
Strategy
Qualified
Institutional Buyers
50%
High net worth
individuals
15%
Retail
35%
Strategy
Strategy
Strategy
-
7/30/2019 Mbd Induction - Latest
10/28
Pricing Strategy
Results ofGlobalMarketing
Analyze levels of demand and over-subscription at various pricelevels
Assess quality of demand
PricingViews by
LeadingInvestors
Analyze demand and price views of global leading investors
Assess after-market price views
RelativeValuation
Apply IPO discount to secondary multiples of comparablecompanies
Market
conditions
Assess relative performance of Asian, European and US markets
Assess volatility in various markets
OtherImportantFactors
Analyze issuer specific objectives
-
7/30/2019 Mbd Induction - Latest
11/28
Underwriting
Underwriting means an agreement with or without conditions tosubscribe to the securities of a body corporate when the existingshareholders of such body corporate or the public do not subscribe tothe securities offered to them.
Underwriters Obligations
In respect of every underwritten issue, the lead merchant banker(s)shall undertake a minimum underwriting obligation of 5% of thetotal issue size or Rs.25 lacs whichever is less.
The outstanding underwriting commitments of a merchant bankershall not exceed 20 times its net worth at any point of time.
-
7/30/2019 Mbd Induction - Latest
12/28
Precautions
To study the feasibility of the issue
To assess the companys background and its financials to ensure thatthe investment pays off.
Depending on the background of the company, the underwritingobligation is ascertained.
As per the size of the issue underwritten, the issue has to besanctioned by the appropriate authority.
-
7/30/2019 Mbd Induction - Latest
13/28
-
7/30/2019 Mbd Induction - Latest
14/28
Corporate Restructuring
Karvy provides clients with strategic and practical solutions to financial
challenges. The uniqueness ofKarvys advisory capabilities lies in its ability to
balance the objectives of the companies as well as that of the promoters. Our
advisory services pertaining to Corporate Restructuring includes:
Buy Back of Shares
Delisting
Takeovers
-
7/30/2019 Mbd Induction - Latest
15/28
Rationale for Buyback
Dilemma of free cash flow
Normally when share price is depressed and the management perceives that
the Company is undervalued.
To achieve or maintain a target capital structure
Signal to market and support price
Prevent hostile takeovers
Return capital to shareholders when you are in a mature industry or as taxefficient alternative to cash dividend
Reduce minority shareholders
Regulations for Buyback
SEBI (Buyback of Securities) Regulations,1998
-
7/30/2019 Mbd Induction - Latest
16/28
Major Buyback Issues Handled
Executed
Punjab Communications Limited
Titanor Components Ltd
The Nellimapathy Tea Produce Co. Ltd
Heritage Foods (India) Ltd Bhagyanagar Metals Ltd
The Sirpur Paper Mills Ltd
Chordia Food Products Ltd
Mro-tek Limited
Pipeline
Assam Carbon Products Limited
-
7/30/2019 Mbd Induction - Latest
17/28
Rationale for Delisting
Consequent to public holding falling below the minimum limitspecified in the listing conditions
To avoid complying with the rigorous listing requirements
Meagre or Nil trading on SEs
Not traded at intrinsic values
Regulations for Delisting
SEBI (Delisting of Securities) Guidelines - 2003
-
7/30/2019 Mbd Induction - Latest
18/28
Major Delisting Issues Handled
Executed
Spencer and Company Limited
Sharadha Terry Products Limited
Ideaspace Solutions Limited
SRP Tools Limited
Rockwool (India) Limited
Kadri Mills Limited
Federal Technologies Limited
Harisiddha Trading & Finance Limited Spectra Punj Lloyd Limited
Pipeline
Quality Care India Limited
-
7/30/2019 Mbd Induction - Latest
19/28
Rationale for Takeover
Synergies in operations create economies of scale.
Global exposure compel companies to become more competitive.
More efficient and focussed by hiving off certain parts of theirbusinesses and adding others.
Shakeout in several sectors as a result of changes in governmentpolicy.
Consolidation of small and fragmented players
Tax advantages from restructuring.
Regulations for Takeover
SEBI ( Substantial Acquisition of Shares and Takeovers) Regulations, 1997
-
7/30/2019 Mbd Induction - Latest
20/28
Major Takeovers Handled
Executed
Venkataramana Hotels Limited
Stewarts & Lloyds of India Ltd
SSI Limited
Quintegra Solutions Ltd
Pennar Industries Ltd Kerry Jost Engineering Ltd
Raasi Refractories Ltd
WPIL Ltd
Saag Mauritius Ltd
TTK Healthcare Ltd
RR Greenhands Infrastructure Ltd Advanced Micronic Devices Ltd.
Pipeline
WPIL Limited
-
7/30/2019 Mbd Induction - Latest
21/28
Private Placement
Raising capital through a private placement of a companys securities is an
effective and timely alternative to a public offering.
A company can consider such financing at an early stage in its development or as
interim financing until a public offering can be completed.
Private placement or private investment capital is money invested in the company
usually from private investors in the form of stocks and sometimes bonds. Karvy's nation-wide presence and excellent rapport with Financial Institutions
(FIs) and High Net worth Individuals (HNIs) enable speedy and immaculate
private placements of debt and equity.
We have mobilized more than Rs.10,000 crores to Government of Andhra Pradesh
in the form of debt.
Our financial presentations have been well appreciated by the Institutional
Investors and High Net worth clients.
-
7/30/2019 Mbd Induction - Latest
22/28
Karvy Investor Services Limited
Karvy has obtained its Merchant Banking License in 1995.
Since 1995, Karvy has handled over 150 issues in various capacities
Evolving into top league Investment Banker
Strong execution team
Excellent institutional relationships
Offices established in Dubai and New York to tap FII and NRI clientele
-
7/30/2019 Mbd Induction - Latest
23/28
Corporate Finance Division
Corporate Advisory
EquityPlacement
Debt Syndication
M & A
Advisory
-
7/30/2019 Mbd Induction - Latest
24/28
Objective
Flawless execution to meet diverse client needs
Wealth Maximization
Relentless improvisation
Identifying investment opportunities
Exceeding Expectations
Strategies
Avenues
Client
Knowledge
Wealth
Satisfaction
-
7/30/2019 Mbd Induction - Latest
25/28
Services Offered
Mergers &
Acquisition
Buy Side Transaction Sell Side Transaction Leveraged Buyouts Management Buyouts Divestiture
DebtSyndication
Term Loan Working Capital Loan
Mezzanine Financing ECB/ FCCB Project Financing
Private Placement ofEquity
PIPE: Private investmentin Public Equity
QIP: QualifiedInstitutional Placement.
Venture Funding
ADR / GDR
Equity
Placement
Business Plan Public Private
Partnership Advisory Strategic Project
Advisory Financial Reengineering Project Identification Corporate Restructuring
Corporate
Advisory
-
7/30/2019 Mbd Induction - Latest
26/28
Philosophy
Karvys Corporate Finance Group couples extensive experience and expertise with anintense commitment to build meaningful long-term client relationships.
Small to medium enterprises inthe emerging Growth Sectors.
Has collective investment banking andcorporate finance experience, of 100years
Highly versatile team with executionexperience in different types oftransactions for various industries.
Personal attention and counseling tothe clients.
Understanding complex operational,strategic, and financial issues
Offering value additions and creativesolutions.
Our Expertise Our Understanding
Client Focus
-
7/30/2019 Mbd Induction - Latest
27/28
A FULL SERVICE HOUSE
Full Service : Complete basket of equity capital market services, including
public offerings, private placements, mergers and acquisitions, advisory,
equity research, institutional distribution
Network & Reach : Pan-India network of 550 owned branches is practically
the best sales engine in the industry
Research Driven : Equity research forms the essence of our business model
and drives our investment banking, sales, trading & wealth mgmt. services
Quality, Focused Advice and Execution : Research and investment banking
professionals work as a team to provide domain expertise, execution and
service
After Market Support : Comprehensive market support, including focused
equity research and fund manager meetings
Long Term Commitment : Senior-level attention not only during
transactions, but throughout
Integrated Approach : Capabilities to deliver in all spheres of financial
services
-
7/30/2019 Mbd Induction - Latest
28/28
ThankYou !