Function # 1. Corporate Counselling:
This service is, usually, provided free of charge to a corporate unit. Merchant bankers render advise to corporate enterprises from time to time in order to improve performance and build better image/reputation among investors and to increase the market value of its equity shares. Counselling is provided in the form of opinions, suggestions and detailed analysis of corporate laws as applicable to the business unit.
Areas of corporate counselling include:
(a) After considering the existing Government’s economic and licensing policies, it guides the corporate units as to areas of diversification.
(b) Merchant banks make a detailed market analysis so as to evaluate profitability of each product line, its growth or demand at present and in future. On the basis of analysis it advises whether to continue/expand or discontinue any product line.
(c) It helps in reviving the old-line projects and sick units by assessing their requirements, studying their manufacturing process and technology in terms of its obsolescence. Based on their studies, merchant banker advises on the restructuring or reorganisation of capital base.
In India, Punjab National Bank (PNB) claims to have acquired special expertise in revival of sick units. It offers help to the sick units in the following ways:
(i) Conducts detailed studies.
(ii) Makes an assessment of the revival prospects and then prepares rehabilitation plans including schemes of modernisation, identifying areas of diversification, reorganisation of financial and organisational structure.
(iii) Provides help in raising loans from the financial institutions and credit facilities from the banks.
(iv) Helps in getting approval of financial institutions or banks for schemes of rehabilitation.
(v) Monitors rehabilitation schemes.
(vi) Finds out the possibilities of takeover of sick units and accordingly makes arrangement for negotiations with financial institutions/banks and other interested parties.
Function # 2. Project Counselling:
Project counselling broadly covers the study of the project and providing advisory services on the project viability and procedural steps to be followed for its implementation.
Share with your friends: | 
