IBS Hyderabad (Academic Year – 2022-24)
Course Handout
Program
:
MBA
Course Code
:
SHF1441
Course Title
:
Investment Banking
Faculty Name
:
Dr. Kamesh
Consultation Hours (Day/time): Friday (On Appointment)
Mobile No
:
9848493657
Semester: III
Room No: F015
Email: kamesh@ibsindia.org
MBA Programme Outcomes
PO Number
IBS - Programme Outcome (MBA)
1
Critical Thinking
2
Effective Communication
3
Social Interaction
4
Effective Citizenship
5
Ethics
6
Environment & Sustainability
7
Self-Directed & Life-Long Learning
8
Initiative/Leadership
9
Employability
10
Teamwork
11
Cross Functional Perspectives
12
Mastery in Analytics
Course Description:
Investment Banking, over the years has transformed itself from merely offering fee based capital
raising advisory services to encompass the entire gamut of advisory to execution of strategic investing
and financing activities of a business. This course delves into the structure, management, and
practices of Investment Banking (IB), covering some of the significant activities like fund raising,
valuations, mergers and acquisitions, and management of financial investments. It also looks into the
business practices of Private Equity, Hedge Funds, and Venture Capital firms. This course highlights
the significant role of the Investment Bankers through case-discussions, and project works. As part
of this course, issues related to raising finance in emerging markets and startups, the pros and cons
of debt and equity finance, and the emergence of structured finance will be discussed.
Course Objectives:
The following are the objectives of the course.
• To introduce the profession of Investment Banking with its prominent verticals of services
• To develop the skill of valuing firms, with some popular tools of corporate valuation.
• To sensitize to the pros and cons of equity, debt, hybrids and structure financing.
• To provide a fair understanding on the Mergers and Acquisitions Process.
• To create exposure to some significant related topics like Leverage Buyout, Venture Capital,
and Angel Finance.
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IBS Hyderabad (Academic Year – 2022-24)
Course Learning Outcomes:
After the course, the students will be able to develop the following skills and comprehension
CLO-1 – Comprehend the role of investment bankers in financial sector
CLO-2 – Apply the various tools and techniques of corporate valuation
CLO-3 – Analyze the alternatives related to long-term sources of finance for a firm
CLO-4 – Critically evaluate the rationale behind Mergers and Acquisition and other Corporate
Restructuring Processes.
CLO-5 – Estimate the range of values of cash or share compensations in Mergers and Acquisitions,
and level of debt in leverage buyouts.
CLO-6 - Differentiate between various popular financing avenues for startups
Mapping Course Learning Outcomes:
Course Learning
Mapped
Outcomes
Program Outcomes
CLO-1
PO1, PO2, PO5, PO9
CLO-2
CLO-3
CLO-4
CLO-5
CLO-6
Mapped Pedagogy
Lecture,
Numerical
Exercises,
Case
Method
PO1, PO7, PO9, PO11, PO12 Lecture,
Numerical
Exercises,
Case
Method, Project Work
PO1, PO5, PO9, PO12
Lecture,
Numerical
Exercises,
Case
Method
PO1, PO5, PO9, PO11
Lecture,
Numerical
Exercises,
Case
Method
PO1, PO2, PO7, PO9, PO10, Lecture,
Numerical
PO11, PO12
Exercises,
Project
Work
PO1, PO2, PO7, PO9, PO10,
PO11
Mapped Assessment
MCQ Quiz, Mid Term,
End
Term,
Case
Analysis
MCQ Quiz, Mid Term,
End
Term,
Case
Analysis, Project Work
MCQ Quiz, Mid Term,
End
Term,
Case
Analysis
MCQ Quiz, Mid Term,
End
Term,
Case
Analysis
MCQ Quiz, Mid Term,
End Term,
Recommended Text Book:
Investment Banking: Concept, Analysis and Cases, Pratap Giri Subrahmanyam, 4th Edition, McGraw
Hill Education Pvt. Ltd.
Note: The topics in course outline are mapped to respective chapters in the Recommended Text
Book
Suggested reference books:
Damodaran on Valuation: Security Analysis for Investment and Corporate Finance, Aswath
Damodaran, 2nd Edition, Wiley Publishers
Investment Banking Explained: An Insider’s Guide to Industry, Michel Fleuiret, 1st Edition, McGraw
Hill Education Pvt. Ltd.,
Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions, 2nd Edition
(2013) by Joshua Pearl, Joshua Rosenbaum, Wiley Publishers
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IBS Hyderabad (Academic Year – 2022-24)
Digital Resources:
A] Academic Content/NPTEL/SWAYAM Videos:
S.
Topic
NPTEL/MHRD Projects Links
No.
1. Introduction
https://www.youtube.com/watch?v=ope5Y3Mrsa
to Investment w
Management
2. Valuation
https://www.youtube.com/watch?v=c20_S-QgvsA
https://www.youtube.com/watch?v=znmQ7oMiQr
M
https://www.youtube.com/watch?v=xV80dt1OZtQ
https://www.youtube.com/watch?v=8vYQpWXQ5
hE
3.
4.
5.
Equity
Financing
https://www.youtube.com/watch?v=bp76hNEIjAs
https://www.youtube.com/watch?v=yWIeTQfyZHE
Prof. Jitendra
Mahakud, IIT
Kharagpur
Prof. C.S. Mishra, IIT
Kharagpur
Debt Financing https://www.youtube.com/watch?v=WGYxgESek0 Dr. Bharathi Sud,
0
University of Delhi,
Vidya Mitra,
https://www.youtube.com/watch?v=GaPeH1YchAg Prof. Ashish Pandey
Mergers &
https://www.youtube.com/watch?v=DQVpD9Lpg8 SJ Mehta, IIT
Acquisitions
8
Bombay
B] Insights from Industry:
S.
Topic
Video Links from the Web
No.
1.
Investment https://www.pbs.org/wgbh/frontline/film/meltdow
Banking
n/
https://www.youtube.com/watch?v=bx_LWm6_6tA
2.
Private
https://www.youtube.com/watch?v=44zUkC1xVC0
Placement
3.
Family
https://www.youtube.com/watch?v=suL-HkP-2Ts
Business
4.
Structured
https://www.youtube.com/watch?v=6Y3n4AKYr48
Finance
5.
Merges and https://www.youtube.com/watch?v=30MnAxwDMJ
Acquisitions k
https://www.youtube.com/watch?v=axonFO5Vb2I
https://www.youtube.com/watch?v=sQ6xACl8hJk
6.
S.
No.
Professor/Speaker
& Institution
Prof. Jitendra
Mahakud, IIT
Kharagpur
Prof. Aswath
Damodaran, NYU
Stern School of
Business
Debt
Financing
Topic
https://www.youtube.com/watch?v=cg9RgzYzrK8
Video Links from the Web
3
Speaker/Event/
Organisation
Frontline Video
Nick’s Notebook,
Outsider Club
Vikram Bhalla, Ted
Institute
Guggenheim
Partners
Vineet Patwari, CEO
Elearnmarkets.com
Merit Harbour
Capital Ashbridge,
Europe
David Haber, CEO
Bond Street
Speaker/Event/
Organisation
IBS Hyderabad (Academic Year – 2022-24)
7.
8.
9.
Leveraged
Buyout
Hedge Funds
and
Private Equity
Emerging
Markets
https://www.bloomberg.com/news/videos/20 Bloomberg
21-08-18/investec-india-piyush-gupta-onleverage-buyouts-in-india-video
https://www.livemint.com/companies/news/
pes-may-be-new-promoters-as-buyout-dealsset-to-define-the-decade11583348324649.html
https://www.pwc.com/us/en/industries/priva
te-equity/library/deals-insights.html
Live Mint
https://www.ey.com/en_us/private-equity
Earnst and Young
https://www.youtube.com/watch?v=tbRkdm8
0cFs
https://www.youtube.com/watch?v=r4roG2fc
PXE
https://www.youtube.com/watch?v=_iepDwL
JUwo
365 Careers
C] Web based Data Resources and Infrastructure:
S. No.
Resource
1.
Stock Prices from NSE and BSE
2.
CMIE’S Prowess
Private Equity
365 Careers
Carollyn Campbell,
Managing Director,
Emerging Capital
Partners
Web-Link
www.nseindia.com
www.bseindia.com
www.prowessiq.com
Digital Tools:
Software: MS Office, especially MS-Excel
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IBS Hyderabad (Academic Year – 2022-24)
Session Wise Plan:
Session
Topic
No.
1
Introduction
to
Investment
Banking
Learning Outcomes






02-07
Corporate
Valuation



08-11
Mergers &
Acquisitions


Case/Note/Article
Appreciating the Genesis and
Evolution of Investment Banking
Differentiating Investment and
Merchant Banking
Comprehending various activities
of Investment Bankers
Differentiating Price and Value
Comprehending the fundamental
principles of various methods of
valuation
Ability to apply the suitable
technique of corporate valuation
Reconcile to the limitations of
valuation
Appreciate the significance of
Strategy and Unknowns in
Valuation
Differentiating between Merger,
Acquisition, & Takeover
Appreciate & identify the sources
of Synergy
Choose Payment Mode in M&A
Note on History of
Investment Banking (9-902168) Publication Date: Jan,
2002
Chapters
Chapter
4&5
An Introduction to Cash-flow
Valuation Methods (9-295155) Publication Date: May,
1995
Dixon Corporation: The
Collinsville Plant (9-201-097)
Publication Date: Jun, 1998
Chapter
6 &7
Mercury Athletic: Valuing the
Opportunity (4050)
Publication Date: September,
2009
Valuing a Business
Acquisition Opportunity (9289-039) Publication Date:
Jan, 1989
Acquisition of Consolidated
Rail Corp. (A) (9-298-006)
Publication Date: Apr, 1998
Chapter
14& 15
Acquisition of Consolidated
Rail Corp. (B) (9-298-095):
Publication Date: Apr, 1998
12
Test 1

13-16

Equity
Financing


Appreciating the pros and cons of
equity financing
Understanding the determinants
of equity financing
Appreciating the regulatory
environment for raising equity
funds
Understanding the IPO process
5
United Parcel Service’s IPO
(103015- PDF-ENG)
Publication Date: Oct, 2002
Auctioning Morningstar (9206-023) Publication Date:
Feb, 2006
Linknedin Corporation
(112006-PDF-ENG)
Publication Date: Oct, 2011
Chapter
7,8and 9
IBS Hyderabad (Academic Year – 2022-24)
Pharmacyclics: Financing
Research and Development
(9-201-056) Publication Date:
Jul, 2003

17-18
Debt
Financing



19
20-23
Private
Equity
Leveraged
Buyout




Appreciating the pros and cons of
debt financing
Understanding the determinants
of debt financing
Appreciating the regulatory
environment for raising debt
funds
Understanding activities of
Private Equity
Differentiating between Venture
Capital and Private Equity
Philip Morris Companies, Inc.
(B) (9-292-006) Publication
Date: Aug, 1991
Chapter
3
Valuation in Private Equity
Settings (9-297-050)
Publication Date: Mar, 2011
Chapter
11
Ducati & Texas Pacific Group
A wild ride Leveraged Buyout
(9-801-359) Publication Date:
Feb, 2001
Understanding LBO process
Appreciating the rationale behind
Technical Note on LBO
LBO transaction
Valuation (A): LBO Structure
Valuation in case of an LBO
and Target IRR Method of
Valuation (9-902-004)
Publication Date: Jul, 2001
Test 2
Chapter
15
24
Structured
financing


25

26
27-28
29-30
Capital
raising for
startups and
MSMEs
Credit Rating
Venture
Capital and
angel
financing


Appreciating the need for
Structured Financing
Identifying the applicability of
Structured Financing
Gaining acquaintance of popular
products
Appreciating the issues related
financing startups and MSMEs
Identifying various sources of
financing

To understand Credit rating
process

Differentiating Venture Capital
and Angel Financing
6
Harvard case
Chapter 3
Note on Angel Financing (9298-083) Publication Date:
Jan, 1998
Chapter
11
IBS Hyderabad (Academic Year – 2022-24)
31-32
Hedge Funds

Appreciating the business stages
where these sources are
available


Understanding Hedge Funds
Comprehending the various
investment strategies adopted by
them
Appreciating the opportunities
provided by emerging markets to
raise finance
Getting acquainted with the
instruments and market access to
equity and debt finance

33
Financing in
Emerging
Markets

The Hedge Fund Industry
(9-208-126) Publication Date:
Apr, 2010
Sun Brewing (A) (207022PDF-ENG) Publication Date:
Jun, 2010
Local/National/International Perspective: (Atleast 1 if relevant to the nature of course)
Sessio
n No.
Mapped Topic in
Session Wise Plan
Article/Case/Minor Project
Pedagogical Tool
All
The Text Book cases have National
Examples and the Harvard Cases lined
up have International Perspectives
Case Methodology
All
SDG and ESG Sensitization: (At least 1 if relevant to the nature of course)
Sessio
n No.
Mapped Topic in
Session Wise Plan
19
Private Equity
1
Investment Banking
Article/Case/Minor Project
How VCs can help Startups set
(meet) ESG goals
Recent Ethical Issues in Investment
Banking: John N Reynolds with
Edmund Newell
Pedagogical Tool
Article Discussion
Article Discussion
Data Based Insight:
The trends in M&As or IPOs in India during the last 2 decades. A Visualization approach based on data
from Bloomberg.
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IBS Hyderabad (Academic Year – 2022-24)
Evaluation Timelines and Schema:
Keeping in line with continuous evaluation at IBS the following evaluation schedule has been drawn.
Students are expected to go through the dates / sessions mentioned and prepare accordingly.
Component
Test I
Test II
Project
Class Participation
End exam
Component
number
1
2
3
4
At the end of
the semester
Expected slot /
due date
12th session
24th session
30th session
33rd session
Total
Marks
declaration by
13th session
25th session
33rd session
30th session
Weightage
15
15
20
10
100
Other Specific Instructions:
a. Expectations from Students
a. Students are expected to be punctual to classes and maintain 100% attendance. In any
case, they need to maintain a minimum of required attendance as per norms of IBS,
Hyderabad.
b. Reading the respective chapter before attending the class is highly advisable, however
a reasonable degree of honest participation in the class would bring in the required
learning.
c. They are expected to appreciate that, evaluation components require both individual
and group level involvement. Students should consider group formation as a
professional activity.
b. Use and adoption of software tools:
A management professional requires thorough understanding of domain specific
fundamental formulae and relationship between variables to effectively model it using a
software tool. This facilitates visual reporting to generate insights for decision-making.
Investment Banking course requires thorough financial modelling experience to utilize the
skills in Valuation and Mergers and Acquisition and also in LBO valuations.
c. Plagiarism policy:
Any infringement of copyright/patent/trademark is not appreciated and shall be viewed
seriously. The students are suggested to take proper help/support from the faculty members
in this regard. So that they don’t get into this infringement aspect knowingly/unknowingly.
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IBS Hyderabad (Academic Year – 2022-24)
Project Report/Term Paper Description and Guidelines:
9