NISM‐Series‐IX: Merchant Banking Certification Examination

Frequently Asked Questions about NISM Merchant banking Exam

1. Who can take NISM-Series-IX: Merchant Banking Certification Examination?

Employees working with SEBI registered Merchant Bankers, who

perform SEBI regulated activities such as initial public offer, further public offer, Open Offer, Buy-back, Delisting;
deal with the issuers in connection with activities mentioned in (a) above;
deal with intermediaries associated with activities mentioned in (a) above;
act as designated Compliance Officer dealing with the activities mentioned in (a) above;
submit Due Diligence Certificates to SEBI in connection with the activities mentioned in (a) above;

How can I register for NISM-Series-IX: Merchant Banking Certification Examination?

Candidates can register with National Institute of Securities Markets (NISM) at https://certifications.nism.ac.in/nismaol/

After successful registration, candidates may select a test centre, date and time slot of their choice on the link provided above

What is the fee & assessment structure?

Fee : Rs 1500
Total Questions : 100
Total Marks : 100
Negative Mark : 25%
Passing Score : 60%
Certificate validity : 3 years

Is there a study material available for preparing for this examination?

You will receive a soft copy of the workbook/study material after enrolment for the examination. For non-receipt of soft copy of the workbook/study material, you may contact the NISM helpdesk at certification@nism.ac.in

How can I appear for NISM-Series-IX: Merchant Banking Certification Examination Mock test? Where do I get sample questions for NISM Merchant Banking Exam?

Click here to take a mock test.

Syllabus Outline with Weightages

Chapter	Chapter name	Weightages (Syllabus wise question %)
1	Introduction to the Capital Market	7%
2	Introduction to the Merchant Banking	15%
3	Registration, Code of Conduct & General Obligations of Merchant Bankers in India	15%
4	Issue Management – Important Terms	5%
5	Issue Management – Process and Underwriting	18%
6	Issue Management – General Obligations of Merchant Bankers and Due Diligence	15%
7	Other Merchant Banking Activities - Mergers, Acquisitions & Takeovers	15%
8	Other Merchant Banking Activities - Disinvestment, Buyback of Equity Shares	10%

Curriculum

I. Introduction to the Indian Capital Market

Understand the Capital market structure in India and the role of capital market in the economy.
Know the different Products in the Indian Market for example Equity, Debt and Derivatives.
Know the different Participants in the Indian Capital Market for example Issuers, Investors and Intermediaries.
Know the Regulators and the Regulatory Framework of the Indian securities market in India.

II. Introduction to the Merchant Banking

Understand the Concept and Evolution of Merchant Banking
Highlight the difference between merchant banking and commercial banking.
List the difference between Merchant Banking and Investment Banking
Know the evolution of International merchant banking scenario.
Know the Glass-Steagall Act in brief and its repeal.
Understand the merchant banking in Indian context.
Know the different Regulations governing Merchant Banking Activity in India

III. Registration, Code of Conduct & General Obligations of Merchant Bankers in India

Highlight the various activities undertaken by the merchant bankers in India.
Know the definition of a merchant banker
Know who can be registered as a merchant banker?
Understand the eligibility criteria for registering as a Merchant Banker
Know the Registration Procedure, Renewal Fees and Validity
Understand the conditions of Registration
Know the registration requirements of Merchant Bankers as Underwriters
Understand the Code of Conduct prescribed for Merchant Bankers
Understand the General Obligations and Responsibilities to be followed by the Merchant Bankers with regards to the following:

Follow the code of Conduct Maintain books of accounts, records etc Submission of half-yearly results Responsibilities of lead managers
Lead merchant banker not to associate with any Merchant Banker which is not holding
SEBI registration Underwriting Obligations Acquisition of shares prohibited Information to SEBI Disclosures to SEBI Appointment of compliance Officer

Learn about the Investor Grievance redressal and SCOREs.

IV. Issue Management – Important Terms

Public Offering Initial Public Offer
Further Public Offer
Offer for Sale
FPO IPP QIP / Preferential Allotment Offer for sale through Stock Exchange Mechanism Offer Document
Draft Red Herring Prospectus, Red Herring Prospectus, Book Building Process, Fixed Price Issue, Differential Pricing, Fast Track Issue
Green Shoe Option ,Safety Net, ASBA, Soft and Hard Underwriting ,Open and Closed Book, Basis of Allocation
Categories of Investors

Retail Individual Investors (RIIs)
Non Institutional Investors (NIIs)
Qualified Institutional Investors (QIBs)
Anchor Investors Designated Stock Exchange Employee Specified Securities

V. Issue Management-Process and Underwriting

Understand the process of issue management and know the merchant banker’s role in it.
Learn about the appointment of SEBI registered Intermediaries and other intermediaries
Learn about the process of filing of offer document by the issuer with SEBI and the ROC with the help of the lead Merchant Banker
List the documents to be submitted before opening of the Issue, Copy of agreement between the Issuer and Merchant Banker, Certificate of compliance stating compliance of conditions, Due diligence certificate while registering DRHP/ Red Herring Prospectus/ prospectus with the ROC/ final post issue report
Learn about the type of In-Principle approval from recognized stock exchanges for initial public issues as well as in the case for rights and further public offerings.
Draft Offer Document to be made Public
Opening of an issue
Dispatch of Issue Material and distribution
Understand how the issuer determines the price of the security in consultation with the Lead Merchant Banker
Know the role of merchant banker in underwriting of an issue
Learn about the minimum subscription
Know how the allotment, refund and payment of interest is done

VI. Issue Management- General Obligations of Merchant Bankers and Due Diligence

Understand the general obligations of Intermediaries with respect to Public Issues and Rights Issue
Know about the Pricing in Preferential Issue
Know the Pricing and restrictions on allotment of Qualified Institutional Placement
Know the Pre-issue advertisement for rights issue utilization of funds raised through rights issue and the manner of disclosures in the offer document.
Understand the procedure for Institutional Placement Programme w.r.t Offer Document Pricing and allocation/allotment Restrictions, Minimum number of allottees Restrictions on size of the offer Period of subscription and display of demand Transferability of eligible securities
Understand the procedure for issue of Indian Depository Receipts (IDRs) w.r.t Eligibility Conditions for issue of IDR, Minimum Subscription Filing of Draft Prospectus, Due diligence Certificate, Payment of Fees and Issue of advertisements for IDR Post Issue Reports Undersubscribed Issue Finalisation of basis of allotment
Learn about the importance of Due Diligence, the role of external parties in the due diligence process
List the due diligence documents

VII. Other Merchant Banking Activities - Mergers, Acquisitions & Takeovers

Understand the difference between Mergers , Acquisitions and Takeover
Know the role of Merchant Banker in M&A and Takeovers
Understand the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 w.r.t Substantial acquisition of shares or voting rights Voluntary Offer Offer Size Offer Price Payment Mode Exemptions Process of Open Offer

VIII. Other Merchant Banking Activities - Disinvestment, Buyback of Equity Shares

Understand the Role of Merchant Banker in Disinvestment process
Know the Role and Obligations of Merchant Banker in Buyback of Equity Shares
Understand the Role of Merchant Banker in Delisting of Shares
Understand the Role of Merchant Banker Issue and Listing of Debt Securities
Know the Role of Merchant Banker in ESOPs