I-banks at the IIMs drop an optimistic note on India’s economy

Investment banks and private equity firms are handing out more domestic postings than international gigs to graduating students of the Indian Institutes of Management, in a sign that the persistent funding winter perhaps is finally thawing.

Large domestic as well as global firms including DE Shaw, Goldman Sachs and Premji Invest are hiring graduates for functions across wealth management, institutional equities, asset management and investment banking profiles. But given listless global markets, few of these have been for international roles, show campus placements reports at the IIMs.

Domestic postings were instead made more attractive with higher-than-usual joining and retention bonuses. The roles were mainly in investment and market research, corporate, wholesale and retail banking, trading, and operations functions.

While graduating students who might have been hoping for international roles would likely be disappointed, there’s a potential silver lining for homegrown companies in this shift in hiring patterns.

Investors and bankers expect the fundraising cycle to pick up again in 2024 after a funding winter that has prolonged for about two years, especially for early- and growth-stage companies.

“Our investment banking business is growth-focussed and we see a lot of tailwinds. We want to be ready for the structural long-term India growth story,” said Anirban Banerjee, chief human resources officer at Avendus Group. The financial services firm recruited 15 associates from the batch of 2024 at the IIMs.

India’s retained its crown as the world’s fastest-growing major economy, growing at 8.4% in the December quarter and showing signs of expanding at 7.6% clip in FY24, as per the statistics ministry’s latest data. 

Bucking initial fears of a poor placement season, the IIMs have seen consulting firms, consumer goods companies, banks and large conglomerates recruit management graduates in good numbers, but with a marked preference for students with work experience. 

While the established older IIMs have almost completed their placements, the newer ones are  in their last leg.
Recruiters said the graduating students, cognizant of the global market conditions, as they should be, were keen on accepting domestic roles rather than hanker for international postings.

“The students from IIMs were more welcoming to the domestic firms including JM Financial and it was quite encouraging for us,” said Anil Salvi, managing director and group head, human resource and administration, at JM Financial. “We feel the gap between the domestic versus international postings is getting narrower and students are clearer and realistic on their career expectations and aspirations.”

The homegrown investment bank hired management analysts from the IIMs at Ahmedabad, Lucknow and Udaipur.

“The Indian economy has charted its growth path and is showing resilience so much so that the impact of global macro indicators is balanced with the domestic drivers,” Salvi said.

According to a placement team member at IIM-Udaipur, the banking, financial services and insurance sector was surprisingly upbeat on hiring. “While consulting firms had taken the hit, the BFSI sector and investment banks that had profiles based out of India recruited with higher joining and retention bonuses,” this person said.

Investment banks and domestic private equity firms have rolled out offers at a median ₹25-30 lakh, according to this person.

Another placement head at one of the older IIMs said the business school had taken additional measures to bring in banks and asset management funds for hiring. “We conducted more seminars with the domestic I-banks and had students who had experience in the BFSI sector, and this led to a higher-than-expected (number of) recruiters coming in.”