According to Securities and Exchange Board of India (SEBI) how many categories of Merchant Banking Organisation exist in India? Explain the categories.

The following four categories of the merchant banking organizations exist in India: Institutional based merchant banking organizations that operate as subsidiaries of private financial institutions or those recognized by the state or central governments. Banker based organizations are those that operate as divisions or subsidiaries of the nationalized commercial banks or the foreign banks functioning in the country. The third category consists of qualified brokers who provide skilled merchant banking services like portfolio management. The private merchant banking organizations work as sole proprietorships, private limited, public limited or partnership companies. Alternate Answer 2A(iii) (SEBI Classification) According to the Securities and Exchange Board of India, merchant bankers are classified under four categories for the purpose of registration. Category I , that is- (i) to carry on any activity of the issue management, which will, inter alia, consist of preparation of prospectus and other information relating to the issue, determining financial structure, tie up of financiers and final allotment and refund of the subscriptions; and (ii) to act as adviser, consultant, manager, underwriter, portfolio manager; Category II , that is to act as adviser, consultant, co-manager, underwriter, portfolio manager; Category III , that is to act as underwriter, adviser, consultant to an issue; Category IV , that is to act only as adviser or consultant to an issue.