Indian investment bankers tighten grip over the league table

Illustration: Binay Sinha
Indian investment bankers have consolidated their hold over the league table of managers of equity offerings, with ICICI Securities jumping eight positions to claim the top spot and domestic firms accounting for three of the top five positions thus far in 2021.

ICICI Securities has a 10.5 per cent market share and has so far managed 28 deals worth Rs 13,359 crore, according to Bloomberg data. It is followed by BofA Securities, Citi, Axis Bank, and Kotak Mahindra Bank.

Axis Bank and BofA Securities have retained their places in the top 5 while JP Morgan, which topped the league tables last year, has been pushed to the sixth position, and HSBC, which held the second position last year, has fallen to the 14th spot. SBICAPS (State Bank of India's investment banking division), which was fourth last year, has been pushed to the 12th spot.

The change in the league table comes at a time when Indian companies have continued to look for secondary equity issuances and initial public offerings (IPOs) amidst a booming equity market. The value of deals credited to lead managers stood at Rs 1.29 trillion, against Rs 2.16 trillion the previous year. The top five managers together command a market share of 47.64 per cent. The number of deals managed by BofA and Citi was lesser than those of their domestic counterparts in the top 5.

BofA and Citi together managed 22 deals, against 82 by the other three of the top five. Axis Bank, which managed 32 deals, has handled the highest number of deals so far this year.

ICICI Securities has jumped eight positions compared with last year. It credited the strengthening of its team over the last few years and deepening domain knowledge as the reasons for bagging the top position in league tables.

“We recruited at the mid and senior levels. We also strengthened our equity research and distribution team in India and the US. Our teams are based on industry verticals. People who head those teams have at least 20 years of experience in understanding that sector,” said Ajay Saraf, head of investment banking and institutional equities, ICICI Securities.

The team is at least 15 per cent larger than what it was two years ago, he said. Its investment banking team has about 75 people and it has a similar number in its institutional equity and institutional research teams. “That helps us understand the clients better, which converts many of our pitches to mandates,” Saraf added.

When asked about the deal pipeline for the rest of the year and whether topping the league table has led to more investment banking fees, Saraf said investment banking fee as a size of the issue has risen over the last few years.

“The deal pipeline will be twice the size of what we have done until now regarding the total value of the transactions. Being an India centric investment bank, we understand the local dynamics better," said Saraf.

During the first quarter of financial year 2021-22 (Q1FY22), ICICI Securities’ revenue from the investment banking business was Rs 47 crore. In comparison, it was Rs 161 crore for the whole of FY21 and Rs 76 crore in FY20.

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