Maximising corporate value

Last Updated 28 July 2010, 09:52 IST
Maximising corporate value

Corporate finance is an emerging career. It is an area of finance dealing with financial decisions that business enterprises make and the tools and methods used to make these decisions.

The primary goal of corporate finance is to maximise corporate value while managing the firm’s financial risks. Although it is, in principle, different from managerial finance which studies the financial decisions of all firms, rather than corporations alone, the main concepts in the study of corporate finance are applicable to the financial problems of all kinds of firms.

In most businesses, corporate finance experts focus on raising money for various projects or ventures. For investment banks and similar corporations, corporate finance experts focus on the analysis of corporate acquisitions and other decisions.

The financial sector in India has experienced a growth rate of 8.5 per cent a year. The steady rise in the growth rate suggests a robust economy. The analysis of the Indian financial sector shows growth in capital markets, venture capital markets, banking and insurance sectors etc.

The demand for experienced finance professionals and advisors is steadily rising.
The Banking, Financial Services and Insurance Sector in India currently employs 4-4.5 million people. This is expected to grow to 8.4 million by 2022. Individuals who are employed in the corporate finance sector specialise in helping companies in generating funds that are essential to support and expand business operations, handle acquisitions, manage cash resources and ensure financial and economic stability in the future. As a corporate finance professional, you are not required to work on commission or other incentives, instead, your success counts on your capability to create financial strategies and plans which will beef up the company’s productivity in the long run.

Jobs in corporate finance are also relatively stable. Performance in these jobs counts, but your job is not going to depend on whether you’re selling enough this week or getting good deals finished this quarter.

Rather, the key to performing well in corporate finance is to work with a long view of what going to make your company successful.

Many would argue that corporate finance jobs are the most desirable in the entire field of finance.

There are myriad options available for corporate finance professionals in areas like retail banking, banking operations, trade finance, research and analysis divisions of banks, mutual funds, financial advisory, KPO, BPO etc.

In the field of corporate finance, one can work as a treasurer, financial analyst, credit manager, cash manager, investor relations officer or finance controller.

Pay packages for fresh graduates start at Rs 15,000-25,000 a month. With some years of experience, one can easily earn up to Rs 40,000-60,000 a month.

Do you have it in you?

To be a successful corporate finance professional, you need to possess strong oral and written communications skills, interpersonal skills, manage-ment skills, and a complete understanding of the role of finances and monetary factors in the market.

Knowing foreign languages such as Japanese, Chinese, French, German, or Spanish is certainly a plus point as you may need to travel to different countries and regions for business purposes.

You must also be able to quickly adapt to changing technology.

(Published 28 July 2010, 09:46 IST)

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