1. STOCK EXCHANGE AND PORTFOLIO
MANAGEMENT
Avaan Jungalwala
T.Y. B.B.A. (Finance)
Roll no. 31
Submitted To : Mrunal Sir
Submitted on: 29/9/14

3. Historically, merchant banks' original
purpose was to facilitate and/or finance
production and trade of commodities,
hence the name "merchant".
A “Merchant Banker ” could be defined as
“An organization that acts as an
intermediary between the issuers and the
ultimate purchasers of security in the
primary security market” .

4. Merchant banker has been defined under SEBI , merchant
bankers rule, 1992 as “Any person who is engaged in the
business of issue management either by making
arrangements regarding selling, buying or subscribing to
securities as manager, consultant , advisor or rendering
corporate advisory service in relation to such issue
management”.
Merchant Banking came into existence in 17th & 18th century
in Italy & France. Merchant banking in the modern era
started from London; Merchants started to finance the
foreign trade through acceptance of bill.
Merchant Banking officially came to India through Grind
lays Bank in 1969. Recognized the requirements of
Entrepreneurs for diverse financial services.
As of today there are 135 Merchant bankers who are
registered with SEBI, India . This includes Private, Public &
Foreign players.

5. THE SERVICES PROVIDED BY MERCHANT BANKS :
 Project counseling
 Feasibility studies
 Project reports
 Design of capital structure
 Underwriting
 Loan syndication
 Mobilization of funds

6.  Mergers
 Amalgamation
 Take over
and many more.
Merchant Banking is a skill based activity and
involves serving financial needs of every client .
Merchant bankers can turn to any of the activities
depending upon resources, such as capital , foreign
tie-ups for overseas activities and skills.

7. Raising Finance For Clients
 Broker In Stock Exchange
 Project Management
 Advice On Expansion And Modernization
 Managing Public Issue Of Companies
 Handling Government Consent For Industrial
Projects
Special Assistance To Small Companies And
Entrepreneurs
Services To Public Sector Units
 Rival Of Sick Industry Units
 Portfolio Management

8. Corporate Restructuring
Money Market Operation
Leasing Services
 Management Of Interest Dividend
Registration With SEBI As Merchant
Banker
Categories For Registration:
There basically four categories for which registration
may be granted:

9. CATEGORIES FOR
REGISTRATION
ACTIVITIES
CARRIED OUT BY
MERCHANT BANKS
CAPITAL
REQUIREMENT FOR
REGISTRATION
Category I
Issue Management ,
Adviser, Consultant ,
Manager , Underwriter
, Portfolio Manager
Rs. 5 crores
Category II
Adviser, Consultant ,
Co-Manager ,
Underwriter , Portfolio
Manager
Rs. 50 lakhs
Category III Adviser, Consultant ,
Underwriter
Rs. 20 lakhs
Category VI Adviser, Consultant nil

10. Every merchant banker should maintain copies of
balance sheet , Profit and loss account statement
of financial position.
Half-yearly unaudited result should be submitted to
SEBI.
SEBI has been vested with the power to suspend or
cancel the authorization in case of violation of the
guidelines.
Every merchant banker shall appoint a ‘Compliance
Officer‘ to monitor compliance of the Act.

11. SEBI has the right to send inspecting authority to
inspect books of accounts , records etc… of
merchant bankers.
Inspections will be conducted by SEBI to ensure
that provisions of the regulations are properly
complied.
An initial authorization fee , an annual fee and
renewal fee may be collected by SEBI.
A lead manager holding a certificate under
category I shall accept a minimum underwriting
obligation of 5% of size of issue or Rs.25 lakhs
whichever is less

12.  Firstly , the bank have to submit an application
to SEBI in Form A of the SEBI (Merchant Bankers
Regulation 1992) .
 If the application satisfies all the requirements than
the SEBI will issue a certificate of registration in
Form B of the SEBI (Merchant Bankers Regulation
1992) .
 And secondly the bank have to pay registration fee
to SEBI i.e. Rs. 5 lakhs within 15 days after
receiving grant from SEBI.
 This certificate is valid upto 3 years and after that it
have to be renewed by paying Rs. 2.5 lakhs.

13. Banker Name City / State
Axis Bank Limited (Formerly UTI Bank Limited) Ahmedabad / Gujarat
Bajaj Capital Limited New Delhi / Delhi
Bank of America, N.A Mumbai / Maharashtra
Bank of Maharashtra Mumbai / Maharashtra
Barclays Bank Plc Mumbai / Maharashtra
Barclays Securities (India) Private Limited Mumbai / Maharashtra

14. BNP Paribas Mumbai / Maharashtra
BOB Capital Markets Limited Mumbai / Maharashtra
Brescon Corporate Advisors Limited Mumbai / Maharashtra
Brics Securities Limited Mumbai / Maharashtra
Calyon Bank (Formerly Credit Agricole Indosuez) Mumbai / Maharashtra
Canara Bank Banglore / Karnataka
CD Equisearch Private Limited Kolkata / West Bengal
Centbank Financial Services Ltd. Mumbai / Maharastra
Central Bank of India Mumbai / Maharashtra
Centrum Capital Limited (Formerly Centrum Finance
Limited)
Mumbai / Maharashtra
Chartered Capital & Investment Ltd. Ahmedabad / Gujarat