The Investment Banking Course

Module 1 – Introduction to Financial Systems

• Overview of the Global Financial System.

• Participants of the Financial Systems.
• Role of Investment Banks within the system.
Module 2 – Equity Markets

• Primary v/s Secondary Markets

• Equity Market Operations (Listing, Trading and Settlement)
• Overview of Equity Pricing and Valuation
• Initial Public Offerings and Secondary Offering
Module 3 – Valuation Techniques

• Introduction to Business Valuations.

• Valuation using Income approach.
• Valuation using Market approach.
• Valuation using Cost approach.
Module 4 – Derivative Markets and Types

• Introduction to Derivatives (Forwards, Futures, Options, Swaps)

• Hedging Strategies using Derivatives
• Valuation of Derivatives
Module 5 - Basic to Advanced Excel
1. Excel Fundamentals for Financial Modelling.

• VLOOKUP function, errors associated with it, and activities.

• Creating dynamic lists using data validation and named ranges.
• Pivot table creation, rules, and options.
• Pivot table layout changes, report extract in separate sheets, and activities.
• Pivot table calculated field, field settings, slicers, and activities.
• Logical functions like IFS, IFNA, ISNA, ISERROR, IFERROR, etc.
• Reference functions like Index, Match, combinations with other functions, and using
named ranges in formulas.
2. Advance Excel for Financial Modelling.

• VLOOKUP and HLOOKUP

• Match and Index
• IFERROR and IFNA
• Array Formulas
• Logical and Date and Time Functions
• PivotTables: Creating, modifying, filtering and formatting
• PivotCharts: Creating dynamic charts linked to PivotTables
• Advanced Filtering: Using complex criteria, filter by colour, icon, etc
• Data Validation
Module 6 – Financial Modelling

• Financial Statement Analysis – Ratio analysis

• Financial Modelling Fundamentals
• Advanced Excel for Financial Modelling
Module 7 – Leveraged Buyouts (LBOs)
Introduction to LBOs

• Definition and concept of LBOs

• Key players involved in LBO transactions (private equity firms, investment banks, target
companies)
• Benefits and drawbacks of LBOs (for acquirers, target companies, stakeholders)
LBO Structure

• Deal mechanics: acquisition, financing, ownership transfer

• Capital structure in LBOs: debt, equity, and their roles
• Sources of debt financing: senior debt, mezzanine debt, high-yield bonds
• Equity participation: sponsor equity, co-investment
• Legal aspects of LBO transactions: contracts, warranties, representations
• Exit strategies for investors (IPO, secondary buyout, recapitalization)
Types of LBOs

• Management Buyout (MBO): management team acquires the company

• Management Buy-In (MBI): external management team brought in to acquire
• Sponsor-led Buyout: private equity firm takes the lead in acquiring the company
• Strategic Buyout: acquisition by a competitor or industry player
• Recapitalization: using debt to repurchase shares and increase leverage
LBO Valuation

• Target company valuation methodologies: discounted cash flow (DCF), transaction multiples,
multiples of EBITDA
• Synergies and their impact on valuation
• Valuation adjustments for control premium, minority discounts
• Buyer-side vs. seller-side valuation perspectives
• LBO modeling: building a financial model to assess deal feasibility and returns
Legal and Regulatory Framework for LBOs
Module 8: Mergers & Acquisitions (M&A)
Introduction to M&A

• Definition and types of M&A transactions (merger, consolidation, acquisition, tender offer)
• Benefits and drawbacks of M&A (economic, strategic, financial)
• Regulatory environment and antitrust considerations
M&A Strategies and Integration

• Developing M&A strategy: growth, diversification, market share, cost synergies

• Identifying and evaluating potential targets: industry analysis, financial performance, cultural
fit
 • Deal structuring: cash, stock, or a combination (accretive vs. dilutive deals)
• Integration planning: cultural integration, operational integration, communication strategy

Types of Mergers and Acquisitions

• Horizontal Mergers: combining companies in the same industry

• Vertical Mergers: combining companies across different stages of the supply chain
• Conglomerate Mergers: combining companies in unrelated industries
• Tender Offers: public offering to acquire a target company's shares
• Reverse Mergers: private company going public by merging with a public shell company

M&A Valuation

• Target company valuation methodologies: discounted cash flow (DCF), transaction multiples,
multiples of EBITDA
• Synergies and their impact on valuation: cost synergies, revenue synergies
• Valuation adjustments for control premium, minority discounts
• Buyer-side vs. seller-side valuation perspectives
• M&A modeling: building a financial model to assess deal feasibility and returns

The M&A Transaction Process

• Pre-deal planning and target identification

• Negotiations: term sheet development, due diligence process
• Financing the transaction: debt, equity, hybrid structures
• Legal documentation: merger agreement, representations and warranties, closing conditions
• Regulatory approvals: antitrust review, other relevant regulations

Advanced M&A Topics

• Cross-border M&A: additional complexities of international transactions

• Hostile takeovers: unsolicited bids and defense strategies
• White knight defense: friendly bidder emerges to counter a hostile offer
• Poison pills: shareholder rights plans to deter unwanted acquisitions

Module 9: The Startup Ecosystem

Types of Startups

• Exploring different startup types: Bootstrapped, Venture-backed, Scalable, Lifestyle

• Understanding industry-specific startups: Fintech, Edtech, Biotech, etc.
• Identifying the target market and ideal customer profile for each type

Startup Valuation

• Why Valuation Matters - Importance in funding and growth

• Unveiling Valuation Methods:
o Venture Capital Method (compares similar startups)
o Discounted Cash Flow (predicts future cash flow)
• Financial Projections & Valuation - How financial forecasts impact valuation
Funding Landscape

• Stages of Startup Funding: Seed, Series A, B, C (and beyond)

• Investor Landscape: Understanding Venture Capital and Angel Investors
• Bootstrapping vs. Venture Funding: Weighing the pros and cons

Structuring Startup Deals

• Term Sheet Negotiation for Investment Banking & Startups: Key considerations for both
sides (ownership, liquidation preferences, anti-dilution)
• Deal Structuring for Startup Financing: Equity vs. Debt Financing, Convertible Notes
• Legal and Regulatory Considerations: Securities laws, venture capital regulations

Exit Strategies for Startups

• Understanding Different Startup Exit Strategies: Acquisition, IPO, Secondary Sale

• Role of Investment Banking in Startup Exits: Deal origination, negotiation, and execution

Module 10: Due Diligence

Introduction to Due Diligence

• The Role of Due Diligence: Mitigating risk, uncovering deal value, informing negotiation
strategies
• Key Players in Due Diligence: Investment bankers, lawyers, accountants, other advisors
• Ethical Considerations in Due Diligence: Maintaining confidentiality, avoiding conflicts of
interest

Types of Due Diligence

• Financial Due Diligence: Assessing a company's financial health, analyzing historical

performance, evaluating future projections
• Legal Due Diligence: Reviewing contracts, identifying potential legal liabilities, ensuring
regulatory compliance
• Tax Due Diligence: Analysing tax implications of a transaction, identifying potential tax
liabilities
• Market Due Diligence: Assessing the target company's competitive landscape, market trends,
and customer base

Due Diligence Process and Tools

• Developing a Due Diligence Plan: Tailoring the process to the specific deal type and target
company
• Data Gathering and Analysis: Utilizing financial statements, legal documents, industry
reports, and other resources
• Interview Techniques: Effective questioning of management, employees, and other
stakeholders
• Due Diligence Reporting: Structuring and presenting findings in a clear, concise, and
professional manner

Due Diligence Red Flags and Risk Management

• Identifying red flags that may signal potential problems in a deal

 • Renegotiation and Deal Termination based on Due Diligence Findings

Module 11 – Forex & Risk Management

• Introduction to Risk Management

• Risk Identification and assessment
• Financial, Operational & Currency Risk Management
• Forex market: its participants, products (spot, forwards, swaps), and trading platforms.
• Role of forex in international trade, investment, and risk management.
• Factors influencing exchange rates: economic data, interest rates, political events, and market
sentiment.
Module 12 - Compliance and Regulatory Framework in Investment Banking Operations
1. Introduction to Regulatory Environment.

• Regulatory landscape for investment banking activities, including:

• Domestic regulators (e.g., SEC, FINRA, Federal Reserve) and their roles.
• International regulatory bodies (e.g., IOSCO, FSB) and their influence.
• The impact of global financial events on regulatory reforms.
2. Key Regulations in Investment Banking.

• Securities Act of 1933 & Securities Exchange Act of 1934

• Basel Accords: Capital adequacy requirements for banks to mitigate financial risk.
• Regulation Best Interest & Suitability Standards
3. Compliance Requirements for Investment Banking Activities.

• Customer onboarding due diligence procedures (CDD, EDD).

• Transaction monitoring for suspicious activity detection and reporting (SAR).
• Insider trading prevention policies and procedures.
• Chinese Walls to restrict information flow and prevent conflicts of interest.
• Market manipulation prohibitions and surveillance for manipulative trading practices.
4. Foreign Currency Operations under FEMA and Other Regulations.

• The FEMA act and its regulations

• Permissible foreign currency transactions for Indian entities.
• Reporting requirements for forex transactions.
• The role of the Reserve Bank of India (RBI) in overseeing forex markets.
• Anti-dumping and countervailing duties
5. Hedge Funds Regulations.

• Registration requirements with relevant authorities (e.g., SEC)

• Investor qualification standards (accredited investors)
• Reporting and disclosure obligations
• Leverage restrictions
6. Global Regulatory Framework.

• The role of international standard-setting bodies (IOSCO, FSB) in promoting harmonization.

• The impact of cross-border regulations (e.g., MiFID in the EU) on global investment banking
operations. Module: Leveraged Buyouts (LBOs)