Merchant Banking
Merchant banker certification — issue management, IPO process, M&A, takeovers, buybacks, delisting, and SEBI ICDR.
Exam Pattern & Marking
Detailed Syllabus
8 chapters · 100 total marks
| # | Chapter | Marks | Practice Qs |
|---|---|---|---|
| 1 | Issue Management - Process and Underwriting | 18 | 90 |
| 2 | Introduction to Merchant Banking | 15 | 75 |
| 3 | Issue Management - General Obligations and Due Diligence | 15 | 75 |
| 4 | Mergers, Acquisitions and Takeovers | 15 | 75 |
| 5 | Registration, Code of Conduct and General Obligations | 15 | 75 |
| 6 | Disinvestment, Buyback and Delisting | 10 | 50 |
| 7 | Introduction to the Capital Market | 7 | 35 |
| 8 | Issue Management - Important Terms | 5 | 25 |
| Total | 100 | 500 |
Marks per chapter reflect the official NISM syllabus weightage. Practice question counts show the bank size in our app — use them to gauge depth of preparation needed per chapter.
Key Knowledge Areas
Overview
Series IX is the merchant banker certification — required for staff at SEBI-registered Category I merchant bankers handling IPOs, FPOs, rights issues, M&A, takeovers, buybacks, and delisting.
At a glance: 100 questions · 2 hours · 60% pass mark · 0.25 negative marking · ₹1,500 + GST.
Who should take IX
- IB / merchant banking professionals
- Capital markets advisory staff
- Compliance officers at merchant banks
- Equity capital markets (ECM) bankers
Key Knowledge Areas
Issue management lifecycle
Pre-issue: Due diligence → DRHP filing → SEBI observations → RHP filing → roadshow.
Issue: Anchor investor allocation → bid period (3-7 days) → price discovery → basis of allotment.
Post-issue: Listing → stabilisation period → ongoing LODR compliance.
SEBI ICDR Regulations 2018
Key thresholds:
- Minimum public shareholding 25% within 3 years of listing
- Lock-in: promoter contribution 20% locked for 18 months (up from 3 years previously); rest 6 months
- IPO grading optional since 2014
- Anchor allocation up to 60% of QIB portion
Mergers & acquisitions
Types of M&A vehicles:
- Merger — combining two entities under sec 230-232 Companies Act 2013
- Demerger — spinning off a division, tax-neutral if conditions met
- Slump sale — selling a unit as a going concern
- Asset purchase — buying specific assets
SEBI SAST (Takeover) Regulations 2011
Trigger thresholds:
- 25%: open offer mandatory (acquiring direct/indirect)
- 5%/year: creeping acquisition cap
- 75%: minimum public shareholding compliance
Key Fact: Open offer must be for at least 26% of voting capital, priced at the higher of negotiated price, average of recent traded prices, or 60-day VWAP.
Buyback & delisting
- Buyback — Tender or open market route, subject to 25% paid-up capital limit
- Delisting — voluntary (reverse book-building) or compulsory (regulatory)
Code of conduct
Merchant bankers cannot use confidential information, must avoid conflicts of interest, and ensure full disclosure in offer documents. Heavy SEBI enforcement.
Exam Tips
Tip 1: ICDR Regulations specifics (lock-in periods, anchor allocation, MPS rules) are guaranteed exam topics.
Tip 2: SAST Regulations trigger thresholds (25%, 5%, 75%) and open offer pricing rules carry 8+ marks.
Tip 3: Buyback regulations under both Companies Act and SEBI come up. Know the differences and the 25% cap rationale.
Tip 4: Recent SEBI circulars on confidential pre-filing, T+3 listing, and IPO process changes appear. Stay current.
Try the Free Quiz
Test your knowledge with our free Series IX practice quiz — or get the full bank of 500+ IX questions plus mock tests in the NISM Exam Prep app.
Ready to test your Merchant Banking knowledge?
Try 30 free questions now, or get all 500 in the app.
Get the full NISM Exam Prep app
All 13,000+ questions across 31 NISM exams, 20 finance calculators, and pro utilities.
