Q.1 Discuss the importance of growth of merchant banking in India.
Important reason for the growth of merchant banking have been the developmental activities throughout country, exerting excess demand on the sources of funds forever, expanding industry and trade and thus leaving a widening gap unbridged between the supply and demand of investible funds. All India financial institutions had experienced resource constraint to meet the ever-increasing demand for funds from the corporate sector enterprises. In the circumstances corporate sector had the only alternative to avail of the capital market services for meeting their long-term financial requirements through capital issues of equity and debentures. With the growing demand for funds there was pressure of capital market that enthused the commercial banks, share brokers and financial consultancy firms to enter into the field of merchant banking and share the growing capital market. With the result, all the commercial banks in nationalized and public sector as well as in private sector including the foreign banks in India have opened their merchant banking windows and are competing in this field. There has been a mushroom growth of financial consultancy firms and broker firms doing advisory functions as merchant bankers as well as managing public issues in syndication with other merchant bankers.
Notwithstanding the above facts, the need of merchant banking institution is felt in the wake of huge public savings lying still untapped. Merchant banks can play highly significant role in mobilizing funds of savers into investible channels assuring promising return on investments and thus can help in meeting the widening demand for investible funds economic activity. With the growth of merchant banking profession, corporate enterprises in both public and private sectors would be able to raise required amount of funds annually from the capital market to meet the growing requirements for funds for establishing new enterprises, undertaking expansion/modernization/ diversification of the existing enterprises. This reinforces the need for a vigorous role to be played by merchant banks.
Merchant banks have been procuring impressive support from capital market for the corporate sector for financing their projects. This is evidenced from the increasing amount raised from the capital market by the corporate enterprises year after year.

An issuer company may make an issue of securities to the public through a prospectus in the following manner.100% of the net offer to the public through the book-building process or75% of the net offer to the public through the book- building process and 25 % in the price determined through book -building.
The Lead Merchant Bankers should act as the Lead Book Runner and offer eligible merchant bankers.
Additional Disclosures
Apart from meeting the disclosure requirements as specified in the SEBI guidelines as noted earlier, the following disclosures should also be suitably made. The particulars of the syndicate members along with the details of registrars, bankers to the issue and so on.
The following Statement under the Basis for Issue Price:
The issue price has been determined by the issuer in consultation with the book runners on the basis of the assessment of market demand for the offered securities by way of book building.
Underwriting: In case the issuer company is making an issue of securities to the public through book-building, the entire net offer ( i. e. 100% and 75% respectively) should be compulsorily underwritten by the syndicate members/ book runners.
Procedure for Bidding: The bid should be open for at least five days and not more than 10 days which may be extended to 13 days in case the price band is revised.
Bidding Form: There should be a standard bidding form to ensure uniformity and accuracy. It should contain information about the investor and price and number of securities that the investor wishes to bid for.
Allocation/ Allotment Procedure: In case of issue of 100 % of the net offer to the public through 100% book-building process (i) at least 25% of the net offer to the public should be available for allocation to retail individual investors, (ii) at least 25% to non institutional investors ( i. e. investors other than retail individual investors and QIBS) and (iii) not more that 50% t QIBS. However, 50% of the issue size should be mandatorily allotted to the QIBS in case of a Public issue by an unlisted company through book-building.

Q.3. Discuss the considerations of marketing products at different stages of the family life cycle.
The family life cycle is a way of segmenting the family market at different stages of the life cycle to determine the products and services that people buy at each stage. The model describes the stages which consumer in their lives as they have families. The model was developed by Wells and Gruber 1960s.

Different stages of the family life cycle.
Bachelor stage Young single people not living at home. Low income but high discretionary income. Decisions influenced by the individuals peer reference group. Few financial burdens. Fashion and opinion leaders. Recreation orientated. Buy - basic kitchen equipment, basic furniture, cars, clothes, holidays, products for the mating game.

Newly married couples (Young, no children): Better off financially than they will be in the near future. High income but likely to have high mortgage commitment. High level of purchase of homes durable goods. Buy : cars, white goods, furniture, holidays, life assurance.

Full nest 1 Youngest child under six. Income low- high debts. Home purchasing at peak. Liquid assets/savings low. Reliance on credit. Child dominated household. Spending dominated by children’s needs. Buy: necessities.

Full nest 2 Youngest chid six or over. Income improving. Lower mortgage burden. Improvement in financial position some wives return to work. Still child dominated household. Children and children’s needs exert considerable influence on household spending. Buy necessities.

Full nest 3 Older married couples with dependent children. Older children at work- other in further/higher education. Financial position better. More wives at work. School and exam dominated household. Expenditure to support children’s education. Buy : more tasteful furniture, non-necessary appliances, holidays.

Empty nest 1 Older married couple- no children at home, head of family still in work. Income at highest level. Expenses low. Home ownership at peak. Interested in travel, recreation, self education. Satisfied with financial position and money saved. Buy : luxuries, home improvements

Empty nest 2 Older married couple, no children at home, head of family retired. Significant cut in income. Concern with level of pensions and savings. Some spending on hobbies and pastimes. Buy medical appliances or medical care. Products to aid health, sleep and digestion. Assist children and grandchildren.