BUSINESS RESEARCH AND INVESTMENT BANKING

Business Research:

Business Research is a process of acquiring information relating to all areas of business, such that the information found will help maximize the sales and profits of the business. Acquisition of information helps the companies determine which product or service is more profitable or in demand to the company. Business Research is basically gathering information for professional or commercial purposes which will help in deciding opportunities and goals for a business. For a new company, business research can help entrepreneurs to determine consumers' needs and demands and see how the competition is forming. Research can be beneficial for businesses in the current operations as it will help in spotting the new trends in the market or to ascertain digital performance. Using various research methods can give the start-up or the established business a good approach to their future ventures.

Types of Business Research:

• Data collection/analysis: Data Collection means collecting or inspecting accurate or relevant data in the form of databases, reports, newsletters, magazines, financial records, etc to gain the perception quickly. Data collection can be an easier and cheaper way to gather information. In comparison with other research methods, this method is considered faster and provides all the information to make a business decision.

• Survey Research: Survey Research is one of the most commonly used methods for collecting data for business research. Survey research means asking various survey questions to particular audiences through survey polls, questionnaires, and online surveys. Most corporations use this method for a better understanding of the market and it also determines the consumer needs or demands. Different types of a survey like cross-sectional survey can help in the collection of data from a particular set of audience at a given point of time or longitudinal survey can help in the collection of data from a particular audience at the various time period in order to understand the change in their behaviour and ultimately a better business decision can be made. Nowadays surveys can be done through email or social media.

• Correlational Research: Correlational Research is done to understand the relationship between two units and what impact they have on each other. Correlational Research also helps in understanding the relationship between two variables using mathematical methods. It can help in understanding how one unit is reliable on another unit for the desired output.

• Ethnographic Research: Ethnographic Research is one of the most difficult research but can help in giving the precise and appropriate information. This research can be time-consuming and can be a high-cost affair but it can give error-free and exact information. It requires the researcher to merge with the surroundings of the organization and focus on the particular set of audience in order to understand their behaviour and culture.

• Interview: The interview is similar to the survey. The only difference between survey and interview is that the interview has open-ended questions and it allows the respondent to answer in open text format so that they can answer as per their knowledge and feelings and understandings. This can help in understanding the subject more clearly and precisely and work upon it there forth. Interviews can help in giving detailed information which makes it easy to take any business decision.

Advantages of Business Research:

• Business Research can help to find out opportunities and threats in the marketplace.

• It can help to identify the problems so that future issues can be tackled.

• It can help strengthen a company's position in the marketplace.

• It can help to understand customers better which indirectly helps in communicating with customers and stakeholders and paying attention to their needs or demands.

• It reduces investment risk.

• Business Research can help in staying up to date with market needs and trends which can help in effective planning of the company and innovations or corrections can be made to stay ahead in the game.

• It can help in tracking competition in the market.

• It can help in determining financial outcomes and investment which will be needed for future endeavors

• Questions like where to spend and how much to spend can be solved by business research.

• It estimates the reputation in the market.

• It increases the brand value of the company.

Disadvantages of Business Research:

• Business Research can be based on assumptions and not on the facts.

• It can be very time-consuming.

• Business Research can be highly expensive, hiring a research expert can be a high-cost affair.

• Research can give you false or inaccurate information sometimes.

• Research can easily go out of date because of constantly changing market conditions/needs.

Conclusion:

Business Research is one of the most effective ways to understand customers, markets, trends, and competitors. This type of research enables companies to understand their market supply and demands. Also, it can help to reduce cost and pay attention to demands in the market and can help to fulfill the customer's needs. It enables the company to make better decisions and it can help in reducing future losses or risks. Better decisions lead to a more successful company and may earn greater profits. If any business owner wants to excel or survive in the market; business research can be considered as the most beneficial and suitable thing to do. Business research is the first step that any business owner needs to set up his business, to survive, or to excel in the market. The main reason why business research is important is that it can help businesses to grow in terms of revenue, market share, and brand value. SWOT (strengths, weaknesses, opportunities, and threats) analysis is also considered as one of the most useful techniques in the growth and improvement of the business.

INVESTMENT BANKING

Investment Banking: Investment Banking is all about raising money for corporations: Investment banks help companies and governments and their agencies to raise money by issuing and selling securities in the primary market. They assist public and private corporations in raising funds in the capital markets (both equity and debt), as well as in providing strategic advisory services for mergers, acquisitions, and other types of financial transactions. So, the simple answer is, investment banks help companies raise money by lending their expertise, preparing all the necessary documents, ensuring that all government regulations have been followed.

Investment bankers act as an intermediary between investors and corporations. Investors are those who have money to invest and corporations are those who require capital to grow and run their business. The critical factors of investment banking are government regulations and market dynamics. The main activity of investment banks is known as security underwriting. Investment banking is needed both by investors and financing. Investors want to maximize their returns while the investment bankers want to keep their investors happy and their business for a long time.

Investment Banking covers two main areas:

Underwriting

M&A Advisory

Raising capital by selling bonds or stocks to the investors

It guides the company through the complicated world of mergers and acquisitions.

Role of Investment Banker: Investment banks serve as a bridge between demand and offer between people who have the capital and want to invest it and people who need financing for their projects. Investment Bankers can raise money on behalf of the corporation either through debt or through equity. The major role of Investment Banker personnel, in this case, is to market the company's debt/equity to potential investors, raise the money from them (if successful), deduct their fees from the money raised, and pass on the remaining to the corporation that wanted the money in the first place. The role of the investment banker in regard to Government entities is that the investment bankers can act as a middleman and negotiate great terms with the bonds that the government wants to offer and sell the bonds to final investors. Before the negotiation process, the investment banker has to contact and make a list of potential investors who are ready to purchase the government’s bonds. All issuers of debt and equity can seek help from the middleman who can contact top tier investors.

Banking Clients: Investment bankers give advice to a wide range of clients regarding capital raising and M&A needs. The clients can be located all around the world. Following are the clients of investment banks:

1. Governments: Investment banks help the government in raising money, trade securities.

2. Corporations: Bankers work with both private and public companies to grow their business, to raise additional capital, make acquisitions, provide research and corporate finance advice.

3. Institutions: Investment banks work with institutional investors who manage other people’s money to help them trade securities and provide research. 

Who are main Investment Banks: The main investment banks are also known as bulge bracket banks which are as follows:

• Bank of America Merrill Lynch

• Barclays Capital

• Citi

• Credit Suisse

• Deutsche Bank

• Goldman Sachs

• J.P. Morgan

• Morgan Stanley

• UBS

List of Top Investment Banks in India:

• Bajaj Capital.

• Avendus.

• ICICI Securities Ltd.

• Kotak Mahindra Capital Company.

• SBI Capital Markets.

• Yes, Bank.

Conclusion:

Investment banks thus deal with helping corporations in raising capital, sales and trading, research, restructuring and reorganization, merger and acquisitions, and security underwriting. Demand for innovations offer opportunities to invest funds for better functioning of the company. Investment bankers act as a bridge between demand and offer between people who have the capital and want to invest it and people who need financing for their projects. Also, it acts as a middleman and gives advice to investors and corporations. Thus, investment banking plays a significant role in the economy i.e. it does the financial planning of the company or person whether it is associated with increased capital through stock or bonds or any other investment.

BY -

PAYAL MEHTA