BRLM Full Form

Full form of BRLM is Book Running Lead Manager. It helps with the process of introducing and selling new financial assets in an Initial Public Offering (IPO). This includes deciding on the price at which the assets will be offered and assisting the company in making them available to the public.

Book Running Lead Manager

A Book Running Lead Manager (BRLM) is a financial institution that oversees the process of launching and selling securities in an Initial Public Offering (IPO) or similar fundraising event. They manage investor orders, set the offer price, and help the company go public.

Book Running Lead Manager Example

Consider a prominent corporation preparing to launch multiple IPOs. In this scenario, having a skilled Book Running Lead Manager is invaluable. The lead manager takes charge of various critical aspects, including financial record scrutiny to ensure regulatory compliance. They may assemble a syndicate of underwriters if needed, carefully selecting firms that meet the issuer’s specific requirements and ensuring that all syndicate members are SEC licensed. Importantly, the Book Running Lead Manager’s role extends to risk assessment, risk mitigation, and offering strategic insights for effective share marketing campaigns tailored to the issuer’s target market.

Types of Merchant Bankers

Merchant bankers are categorized by SEBI into four types for registration purposes. 

1. Type I merchant bankers have a wide range of roles, including serving as issue managers, advisors, consultants, underwriters, and portfolio managers.
2. Type II merchant bankers can take on the roles of advisors, consultants, underwriters, and portfolio managers.
3. Type III merchant bankers are limited to the roles of underwriters, advisors, and consultants.
4. Type IV merchant bankers are primarily engaged as consultants or advisors specifically for capital issues.

These represent some of the primary merchant banker categories, each playing a distinct role in the financial market.

Eligibility For Merchant Banker

Eligibility for a merchant banker to act as a Book Running Lead Manager (BRLM) typically requires a valid SEBI registration in accordance with SEBI (Merchant Bankers) Regulations, 1992. 

Eligibility requirements to become a merchant banker also include:

• A bachelor’s degree in finance, economics, business, or a related field is the minimum requirement. 
• You need to register with financial regulatory authorities and obtain the necessary licenses to operate as a merchant banker.
• Relevant work experience in finance, banking, or investment is often required.

Bookrunner vs Underwriter

The main difference between Bookrunner and Underwriter is that an underwriter in a firm commitment underwritten is usually an investment bank responsible for purchasing shares from the company and selling them to the public while Bookrunner is a primary individual overseeing this process. 

Other differences are:

List Of Book Running Lead Managers In India 

IPO Lead Managers are financial institutions registered with SEBI, appointed by companies to facilitate fundraising through IPOs and subsequent listing on stock exchanges. These lead managers oversee the entire IPO process, including initiating the IPO proceedings, drafting DRHP & RHP, obtaining SEBI and exchange approvals for offer documents, and assisting the company in listing its shares on stock exchanges. 

Book Running Lead Manager – Quick Summary

• A Book Running Lead Manager (BRLM) maintains the book of orders from investors, sets the offer price, and coordinates various aspects of the IPO process, working closely with the issuing company to ensure a successful offering in the financial markets.
• The institution manages the process of launching and selling securities in IPOs.
• There are four categories of merchant bankers, each with distinct roles, including issue management, advisory, underwriting, and consulting.
• Eligibility for a merchant banker to be a BRLM requires valid SEBI registration and relevant qualifications and experience.
• The difference between a Bookrunner and an Underwriter lies in their responsibilities and risk assumption in the IPO process.
• A list of Book Running Lead Managers in India comprises SEBI-registered financial institutions responsible for assisting companies in the IPO process, from initiation to listing on stock exchanges.
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BRLM Full Form – FAQs  

What Is a Book Running Lead Manager?

A Book Running Lead Manager (BRLM) maintains the “book” of orders from investors, sets the offer price, and coordinates various aspects of the IPO process, working closely with the issuing company to ensure a successful offering in the financial markets.

What is the difference between a lead manager and a bookrunner?

The main difference between a lead manager and a bookrunner is that a book runner oversees the complete underwriting process for an IPO, while a lead manager is tasked with identifying purchasers for an IPO and ensuring a smooth sales process without any hindrances.

What is the book running process?

The book running process in an Initial Public Offering (IPO) involves managing and maintaining the book of investor orders for the shares being offered. It includes accepting and recording orders from potential investors, determining the final offer price, and allocating shares to investors based on demand and other factors. 

What is the role of a bookrunner lead manager?

The role of a bookrunner lead manager in an IPO is to coordinate and manage the offering process. This includes setting the offer price, maintaining the book of investor orders, allocating shares, and ensuring the successful issuance of securities. 

Is the lead manager the underwriter?

Yes, in an IPO, the lead manager often acts as an underwriter. They purchase the securities from the issuing company and assume the risk of reselling them to the public.