Financial Services

In India, a myriad of professional advisors, ranging from individual domestic consultants to large multinational organizations, provide a diverse portfolio of services. These include investment due diligence, M&A advisory, valuation, real estate consulting, PMS, risk consulting, and taxation consulting for both individuals and businesses.

Wealth management is an investment advisory service catering to affluent clients, integrating a range of financial services. It involves managing and investing clients’ wealth across diverse financial instruments, including equity, derivatives, debt, mutual funds, insurance products, structured products, commodities, and real estate. The services are tailored to clients’ financial goals, risk profile, and time horizons, encompassing asset allocation, asset management, estate planning, tax accounting, hedge funds, money markets, and retirement planning.

A mutual fund is a registered company that provides professional investment services by pooling money from numerous investors and investing in various securities like stocks, bonds, fixed income, and hybrid funds. Regulated by AMFI, mutual funds offer a lower entry point for investors compared to direct investments in the stock and debt markets. They are an excellent choice for beginners seeking portfolio diversification. Mutual funds in India can be open-ended (redeemable at any time) or closed-ended (with a lock-in period). Redemption timelines vary, with liquid funds taking 1-2 working days, debt funds 2-3 days, and equity funds 3-4 days. The popularity of mutual funds in India is attributed to lower risks, tax benefits, stable returns, and portfolio diversification.

Insurance is a risk management tool designed to mitigate unforeseen financial losses that an individual cannot bear. The Insurance Regulatory and Development Authority of India (IRDAI) regulates the insurance market in the country. With approximately 24 life insurance and 39 general insurance providers, India has a robust insurance sector. Financial services in this domain fall into two main categories:

a] General Insurance : General insurance encompasses agreements that fall outside the scope of life insurance. This category includes various types such as fire, marine, motor, accident, and miscellaneous non-life insurance.

b] Life Insurance : Insurance solutions provide protection for individuals and organizations against unforeseen circumstances and accidents. Governed by the regulations of the Insurance Regulatory and Development Authority of India (IRDAI), it involves a contract between the policyholder and the insurance company. In this agreement, the insurer commits to paying a sum of money in exchange for a premium, either upon the death of the insured person or after a specified period. Life insurance payouts vary based on product nature, customer risk assessment, premiums, time horizons, and other crucial qualitative and quantitative aspects of the policy.

The stock market segment includes investment solutions for customers in Indian stock markets, across various equity-linked products. The primary market is where companies float shares to the general public in an initial public offering (IPO) to raise capital. Under Bombay Stock Exchange and National Stock Exchange in india where shares of publicly held companies shares, exchange-traded funds (ETFs), stock index and stock options, equity swaps, single-stock futures, and stock index futures are bought and sold. The returns for customers are based on capital appreciation – growth in the value of the equity solution and/or dividends – and payouts made by companies to its investors directly.

Debt instruments in this segment involve investments in government and private organization bonds. The issuer or borrower provides fixed interest payments and repays the principal to the investor at the end of the investment period, such as in the case of 3 to 5-year bonds. Instruments in this category include listed bonds, non-convertible debentures (NCD), commercial papers, certificates of deposit, Market-linked debentures (MLD), corporate fixed deposits, capital-gain bonds, debt mutual funds, Government of India savings bonds, tax-free bonds, money market instruments, and treasury bills, among others.

This segment encompasses an extensive range of financial services within the tax and auditing domain, catering to both individual and business clients. Services include :

Individual Tax : Individual income tax, also known as personal income tax, is a levy imposed on an individual’s wages, salaries, dividends, interest, and other sources of income earned throughout the year. This process involves filing tax returns, assessing tax liability, providing advisory services for tax savings, and more. Income taxes serve as a revenue source for governments, funding public services, fulfilling government obligations, providing goods for citizens, and contributing to overall national development.

Corporate Tax : Corporate tax is a levy imposed on the net income of both private and public companies registered in India under the Companies Act 1956. Businesses are obligated to pay corporate tax, involving activities such as determining tax liability, conducting transfer pricing analysis and structuring, handling GST registrations, and providing tax compliance advisory services, among others.

In the auditing domain, service providers offer a range of services such as statutory audits, internal audits, service tax audits, tax audits, process/transaction audits, risk audits, stock audits, etc. These services are crucial to ensuring the seamless operation of business entities from both qualitative and quantitative perspectives, helping to minimize risk.

The Corporate Debt Restructuring (CDR) Cell is the primary authority to which applications are submitted for restructuring. Following extensive discussions between the Government of India and RBI with banks and financial institutions, the Corporate Debt Restructuring scheme has been finalized and enclosed for implementation by banks. Corporate Restructuring encompasses various activities such as mergers, demergers, reverse mergers, disinvestment, takeovers, acquisitions, strategic alliances, etc. These services are primarily offered to organizations and involve restructuring the capital structure through debt and equity to optimize profitability, enhance efficiency, and improve business prospects. Restructuring can also be initiated in response to crises like bankruptcy, volatile markets, hostile takeover bids, or changing market conditions. Financial solutions typically include structured transactions, lender negotiations, accelerated M&A, and capital raising.

This segment provides highly specialized and customized solutions to help clients achieve their financial objectives, goals, and risk tolerance. Portfolio managers or stock market professionals, supported by a research team, analyze and optimize investments across various assets such as debt, equity, insurance, real estate, etc. These services include both Active Portfolio Management and Passive Portfolio Management, catering broadly to High Net Worth Individuals (HNIs). The services can be discretionary, where investment decisions are made solely at the fund manager’s discretion with no client intervention, or non-discretionary, involving decisions made with client input.

The primary objective of financial services is to facilitate the buying, selling, borrowing, and purchasing of securities, enabling payments and settlements, and supporting activities such as lending, borrowing (SLBM), and government-regulated investments.