The Investment banking industry is one of the highest-paying fields today. It is not surprising that many people are pursuing it, and given the high demand for investment bankers in India, there is always room for the best talents, making it a high-in-demand job role.
But is becoming an investment banker for you? And what can you expect from it?
If you are on the path to becoming an investment banker and are seeking answers to questions like these, then this blog is for you.
Read on to discover the role, responsibilities, demand, and scope of investment bankers, followed by insights on investment bankers' salaries in India based on location, experience, and company.
Who is an investment banker?
Investment bankers are professionals offering expertise in financial transactions and services like mergers, IPO releases, company takeovers, and many more. They act as the financial advisors to large companies, businesses, and sometimes, governments.
Investment bankers hold analytical skills and a keen understanding of huge financial transactions like capital raising and mergers and acquisitions.
They play a central role in launching Initial Public Offerings (IPOs) by companies preparing to go public and are responsible for assets management and company investment portfolio.
Their job is part consultancy, part sales & marketing, part persuasion and negotiation, but in the big picture, it is all about closing deals with clients, investors, and stakeholders.
Why does the investment banker industry have high salaries?
Investment bankers are responsible for critical transactions like company mergers, takeovers, etc. These transactions generate significantly big fees, and investment bankers earn high commissions with the same.
A good investment banker is analytical, agile, and equipped with problem-solving skills. Such people are hired by the best firms to take care of all their transactions, and in return, they are compensated with high salaries and perks.
What qualifications does an investment banker need?
The requirement to become an investment banker in India is:
- Class 12 with a specialization in commerce (preferably)
- Bachelor's degree in finance, economics, accounting, or business to get an entry-level position with an investment bank
- Master's degree or a doctorate in finance, economics, accounting, or business
- Mathematical, analytical, project management, negotiation, and communication skills
Note: Degrees like Bachelor of Commerce (B.Com) Hons., Bachelor of Arts (BA) in Finance / Economics, Bachelor of Business Administration (BBA) in Finance, Chartered Financial Analyst (CFA) Programme, etc. can help you become an investment banker
What is the career path of an investment banker?
An investment banker can have various career trajectories. While some may take up internships as an investment bankers, others may switch from other fields to an executive level.
To understand the career path of an investment banker, here are some job roles you can consider pursuing as an investment banker.
1. Investment banking analyst/Senior analyst
One of the entry-level jobs you can land in the process of becoming an investment banker is investment banking analyst. You can get hired as an investment banking analyst on completion of graduation.
Some of the roles and responsibilities of an investment analyst/senior analyst may include:
- Act as a point of contact with clients to inform, engage, and communicate transaction information and understand their requirement
- Draft research reports for the clients and investors with timely addition of initiation notes, earning notes, and event-based notes
- Make collaterals and deliverables for all stakeholders
- Conduct credit analysis and prepare cash flow and valuation models for public and private equity investments
- Knowledge of trading and transaction comps, ratio analysis, and benchmarking
- Analyze and resolve low complexity problems
- Analyzing company reporting documents to create pitchbooks, company profiles, information memorandums, sector reports, financial benchmarking
- Working knowledge of Financial Models, DCF, LBO, and field analysis
- Prepare investment decks by performing secondary research through the web and available databases to convey insights to the clients
The average salary of an Investment banking analyst in India is ₹ 12.2 Lacs and ranges between ₹ 2.3 Lacs to ₹ 25.0 Lacs.
Also see: Investment Banking Analyst jobs
2. Investment banking associate
Another job you can get as you begin your journey towards becoming an investment banker is investment banking associate.
They draft memorandums, crunch numbers, communicate with the investors, and work on cash flow models. Here are some of the roles and responsibilities of an investment banking associate:
- Drafting financial and cash-flow models using MS-excel
- Asset management and valuations
- Presentations and pitching financial models to clients
- Drafting CIM (Confidential Information Memoranda) and similar documents
- Communication and problem-solving skills to deal with clients and investors
- Checking and supervising work done by analysts
- Crunch numbers to be used for further valuation and negotiations
- Collate recommendations for financial transactions like mergers, valuation, acquisitions, and product offerings
- Review pitchbooks, investment memoranda, and marketing material
The average salary of an Investment banking associate in India ranges between ₹ 2.0 Lacs to ₹ 30.0 Lacs with an average annual salary of ₹ 8.6 Lacs.
Also see: Investment Banking Associate jobs
3. Manager investment banking
Some of the roles and responsibilities of manager-investment banking include:
- Knowledge of complete transaction cycle
- Maintaining transaction documents, and focusing on business valuations and investment analysis
- DCF valuation, merger models, cash flow models, and a thorough check on financial records
- Well-versed in corporate financing, and financial models (DCF, LBO, Accretion / Dilution, etc.)
- Information Memorandum, Data mining, and financial statement analysis
- Understanding of merger models and financial due diligence
- User knowledge of standard research databases like Bloomberg, S&P, CapitalIQ, VCCEdge, etc.
- Expertise in MS tools such as Excel, PPT, Word
- Business valuations and investment analysis using precedent transactions or trading comparative valuation analysis
- Exceptional exposure to the entire M&A or PE deal cycle from industry landscaping, and pitching to clients to transaction documentation (deal execution)
The average salary of an Manager Investment banking in India ranges between ₹ 4.4 Lacs to ₹ 30.0 Lacs with an average annual salary of ₹ 16.1 Lacs.
Also see: Manager investment banking
What is the role and job description of an investment banker?
The job role of an investment banker may vary from company to company, but in essence, investment bankers are responsible for all the financial transactions of their clients. The job description for the post of investment banker entails:
- Asset management, valuation, mergers, and company takeovers
- Ability to handle stressed assets, Insolvency & Bankruptcy Code (IBC), One-Time Settlement (OTS), special situation funding, restructuring case, or worked under Insolvency Practitioner (IP)
- Experience preparing investment memorandums, pitchbooks, and management presentations
- Pitching to investors and investor classes like VCs, PE Funds, Family Offices, Angel networks, Accelerators, HNIs, etc.
- Staying up-to-date with market conditions and developments, and ability to identify potential business opportunities
- Financial modeling, developing and presenting financial solutions to clients
- Liaising with the chief executive and CFOs (Chief Financial Officers) of large organizations and coordinating teams of professionals, including accountants, lawyers, and PR consultants, and working closely with them
What is the salary of an investment banker?
According to AmbitionBox, the average salary of an investment banker in India is ₹ 4.7 Lacs and ranges anywhere from ₹ 2.0 Lacs to ₹ 28.2 Lacs
The salary of an investment banker can vary due to several factors like location, skills, experience, company, and so on. Let us find out more about it.
What is the salary of an investment banker based on location?
Investment banker salaries in India can vary in different cities as factors like cost of living, IT development, house rents, etc., play a crucial role in determining the salary structure.
Let us take a look at the salary insights of investment bankers in 4 metropolitan cities of India:
- Investment banker salary in Mumbai ranges from ₹ 1.6 Lacs to ₹ 55.2 Lacs with an average salary of ₹ 4.4 Lacs.
- Investment banker salary in New Delhi ranges from ₹ 2.7 Lacs to ₹ 26.7 Lacs with an average salary of ₹ 9 Lacs.
- Investment banker salary in Bengaluru ranges from ₹ 2.7 Lacs to ₹ 26.4 Lacs with an average salary of ₹ 6.0 Lacs
- Investment banker salary in Pune ranges from ₹ 1.1 Lacs to ₹ 8.9 Lacs with an average salary of ₹ 3 Lacs.
What is the salary of an investment banker based on experience?
The average salary of an investment banker varies depending on the years of professional experience. To help you understand better, we have divided the experience levels into the following bands:
The average salary of an investment banker for entry-level experience (1-3 years) is INR 5.0 LPA and ranges from 2.9 to 12.0 LPA
- The average salary of an investment banker with mid-level experience (3-6 years) is INR 6.4 LPA and ranges between 3.8 to 24.8 LPA
- The average salary of an investment banker with high-level experience (7+years) is INR 14.3 LPA and ranges between 4.5 to 22.3 LPA
What is the salary of an investment banker based on the company?
All companies have different factors which determine the salary range for a position.
Investment banker salaries in India also vary based on factors like project complexity, team size, nature of the company, etc.
Here is the list of a few popular Forbes Global 2000 companies along with the salaries they offer for the position of investment bankers:
In this article, we have tried to extensively discuss investment banker salaries in India with details about varying salary trends based on experience, city, companies, etc.
The demand, scope, and career growth for investment bankers seem promising.
Investment banking aspirants can expect great opportunities, well-paid salaries, and exposure on their journey ahead.
Note: The compensation mentioned in this article are average salaries based on each category and is subject to change in the future.