Small Investment Opportunities in Australia

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Investment Banking in Australia | Top Banks List | Salary | Jobs

Investment Banking in Australia – Have you ever thought about investment banking in Australia? Yes, it may be negligible compared to the revenue and market share in the USA and Europe, but does Australia still have hope?

In this article, we will explore all aspects of investment banking in Australia and will understand how much potential Australia has in making it big in investment banking.

Let’s look at the sequence of the article –

Investment Banking Market in Australia

Australia may not be the most attractive place for investment banking, but still, it has been showing promise of growth. Many investment banks have seen the potential and started exploring the Australian market. For example, we can talk about Macquarie Group which has 6 offices in Australia and they are number 1 in the Australian investment banking market.

Moreover, youth in Australia has still been very positive about the investment banking career. Even if Australia has been losing its ground in investment banking after the global crash, still students and would-be professionals are still preparing and giving interviews for the investment banking domain.

And this are all good news. And Australia is an emerging market that can show a lot of potential in the near future. The investment banks just need to tap into opportunities.

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Investment Banking in Australia – Services Offered

To understand what sort of services Australian investment banks offer, we will pick one of the top investment banks in Australia and peep within their services. This will help us understand the essence of what Australian investment banks offer to its customers.

  • Advisory & Capital Markets: Even if Australia has been doing poorly in investment banking, still the approach of top-notch investment bankers are always customer-centric. The advisers are trained in such a way that they serve their customers first, think about profit, second. And when it comes down to their corporate finance capabilities, they have great expertise which has still helped the Australian market to float.
  • Asset Finance: The investment banks in Australia are experts in providing various finance and asset management solutions. From aircraft to mining, from rail to technology, they provide every possible asset finance services customers would like to get the assistance of.
  • Financing: The Australian market has one benefit – it is an emergent market. Thus, the opportunities are limitless. And investment bankers all over in Australia have been utilizing this advantage as much as they are able to. From lending & investing to commodities & energy/resources, they are everywhere.
  • Asset Management: Australian investment banks are not only handling Australian assets, they are also well-equipped in handling global demand. They have 100+ strategies and several teams to outgrow customers’ expectations. (also, have a look at Asset Management)
  • Research:Equity Research is the holy grail of every business. And Australian investment banks are the centers of excellence at research. Looking at a business from various perspectives and having thoughtful processes are allowing the banks to transcend every limitation. From consumer, demographics, environment, energy to renewables, utilities, telecom & materials, their expertise knows no bound.
  • Trading & Hedging: Australian investment banks are equally capable to handle the trading & capital market. They provide 24-hour access to their customers in terms of global market conditions, price making solutions and global trading. They also help their customers with market research and technical & fundamental analysis.

These are the services top-notch Australian investment banks provide to their customers. And they are constantly uplifting their games and providing cutting-edge solutions to their customers.

List of Top Investment Banks in Australia

Australia isn’t doing great in investment banking. In the first half of 2020, investment bankers in Australia brought in the lowest revenue since 2020, i.e. $591 million. According to Dealogic, Australia’s investment banking revenue had been dropped by 23% to $678 million in the first six months of 2020. But still, amid the clouds, few investment banks did exceptionally well. We will look at the list of top 10 investment banks which did exceptionally well as of June 2020 according to Dealogic. Dealogic has ranked them as per the revenue and percentage of share during the first half of 2020.

  1. Macquarie Group: They had taken the first spot in terms of revenue and market share. The revenue of Macquarie Group was $119 million and the market share is 17.6%.
  2. UBS: UBS was in a second position. They earned a revenue of $57 million and the percentage of a share was 8.4%.
  3. Credit Suisse: At the third position, Credit Suisse had cemented their feet. They generated around $37 million and 5.5% of the market share.
  4. Citi Bank: Citi Bank was in the fourth position, producing around $34 million and capturing 5% of market share.
  5. JP. Morgan: J.P. Morgan had captured the fifth position. They had earned around $34 million and captured 5% of the market (as same as Credit Suisse).
  6. Goldman Sachs: At sixth, there was Goldman Sachs generating around $33 million and 4.9% of market share.
  7. National Australia Bank: National Australia Bank was at the seventh spot. They had generated over $29 million and around 4.3% of the market share.
  8. Bank of America Merrill Lynch: Bank of America Merrill Lynch had cemented their position at 8. They had produced around $27 million and a market share of 4%.
  9. CBA: CBA had taken the ninth position, grossing around $27 million (slightly lesser than Bank of America Merrill Lynch) and capturing a market share of 3.9%.
  10. Morgan Stanley: On 10 th , there was Morgan Stanley. They have generated around $26 million and a market share of 3.8%.

Also, have a look at the following –

Investment Banking in Australia – Recruitment process

In Australia, the process of recruitment is the combination of both Europe-Asia & the USA. Let’s go through the process of recruitment in investment banking –

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  • Online tests: The screening process in Australia is rigorous. Thus, if you want to break in, you need to go through a series of online tests on both verbal and quantitative subjects. Once you are through, you will go over to the next step.
  • Assessment days: On assessment days, the whole scenario is different. You will be given a limited time to prepare a case study on a transaction or hypothetical situation. You will prepare the presentation and will present the case in front of the panel of interviewers. This is a tough screening method because it is pretty difficult to prepare a presentation within a short stint of time while concentrating both on the content and context of the presentation.
  • Series of interviews: Usually, the interview panel gets it’s few best candidates after the assessment day. After the assessment day, it’s time to filter out the good from the great. For that, a series of interviews are taken and the interview process is pretty harder compared to the interviews in the USA & Europe-Asia.

There are a few things that are different in the recruitment process in Australia –

  • Usually, people don’t change careers in Australia. So whenever the recruitment process starts, only finance people apply. And that’s the reason the recruitment process needs to be more solid.
  • People who apply for investment banking positions are on an average bit older and mostly they leave behind a long career in boutique banks or other financial institutions.
  • As the investment banking industry is smaller in Australia and all the candidates seem to have a solid background, the interview process needs to be stricter to filter out the best from the pool of candidates.

Investment Banking Culture in Australia

In Australia, the culture for investment banking is quite different. People working there are a bit older on average. And they don’t work insanely long hours. They have holidays and often even banks get shut down which is almost impossible in the USA & Europe. Investment bankers in Australia maintain a healthy work-life balance along with running their career smoothly. Even at a junior level, you will not need to work 100+ hours which is pretty hard to believe.

The offices are usually divided into two groups – married and single people. And unlike other regions (e.g. USA & Europe), people hang out a lot during work hours (whenever required) and not much after work.

Every organization has a separate team which works on a specific sort of deals. For example, a group of 10 people who are passionate about M&A works on closing more and more M&A deals.

Macquarie Capital provides global investment banking services in six industry groups: Infrastructure, Utilities and Renewables; Real Estate; Telecommunications, Media, Entertainment & Technology; Resources; Industrials; and Financial Institutions. Most other investment banks, in Australia, however, focus on two sectors i.e. energy and natural resources because Australia is known for it.

Investment banking in Australia is quite different as the industry and market are relatively smaller and investment banker specifically works on focused projects instead of trying to cram all of it.

Investment Banking Salaries in Australia

In Australia, the average salary for an investment banker is much lesser than the investment banker in the USA or Europe. And the range of salary is also very broad.

On average, an investment banker in Australia earns around AU $98,471 per annum as per the data are shown by Payscale.com. Here’s the graph below –

Now, let’s go through another graph to understand the range of salary of investment bankers and also the bonus & profit-sharing part of the salaries –

  • We note that the salary range of investment bankers in Australia is AU $51,521 to AU $207,128. This range proves one thing that you will not start at a higher level (in salaries) when you just start out your career in investment banking in Australia. But if you stick for 15-20 years, your salary would get quadrupled.
  • We also get the range of bonuses and profit-sharing i.e. AU $5,000 to AU $100,000 & AU $986 to AU $19,866. These figures also emphasize the importance of experience in the investment banking career in Australia.
  • Experience highly affects the salaries in the investment banking market. If you have more experience, chances are you will be getting much more salary than the investment bankers who are now in the middle of their career. And at entry-level, you need to start with the salary based on industry norms.

In the next graph, we will see the gender division in the investment banking market in Australia –

  • According to this, only 10% of all the people who work in investment banking are female. And the remaining 90% are male. That means we can conclude that investment banking in Australia is a male-dominated industry.

Investment Banking in Australia – Exit Opportunities

As you already know, going from investment banking to the buyer side of the business is a common thing; but in the case of the Australian investment banking market, an exit is a big no-no for candidates.

Since the career change in Australia is a very uncommon thing, people who work in investment banking usually change jobs from one firm to another and also go for a smaller bank to bigger bank; but rarely from investment banking into private equity or hedge funds. Usually, people change jobs for more stability and better salaries, but not for exploration or because they don’t like their investment banking jobs.

So if you start your career in the Australian investment banking market, an exit is not a good option. You may think of moving out of the Australian market and going into the USA or Europe. It can be done, but the issue is the migration doesn’t yield any additional benefit. Having experience in the Australian investment banking market doesn’t count in the investment banking industry in the USA or Europe. As a result, the candidate who has migrated from Australia to the USA or Europe needs to start again from the bottom (which is not a good thing).

You can still change your career (if you want to) if you can’t tolerate the investment banking at all or want to explore more of the market in private equity or hedge funds.

Conclusion

The Australian market is on the rise even if the figures don’t say so. However, if we look into the opportunities created by the foreign banks in the Australian market, we would say there is still hope that the Australian market will come back strongly.

And we will wait to see whether in near future investment banking in Australia will be able to make a dent!

10 Profitable Small Business Ideas & Investment Opportunities in Australia

Australia is one of the countries which has a very good business environment. Better business environment insists on reasonable taxes, allowances, certifications etc. As an entrepreneur it is mandatory for you to conduct your own research on the existence of various other business opportunities in the country.

This is because, you will have to choose between two extremes. One is, a business for which supply is less and demand is more. In such a case, you will be the leader in the industry in few years of entry as there are very less competitors. Other option is to choose a business which has more demand and more supply.

Here, the concept goes by being in the safer side of a tested market. On choosing the second type, you will know in advance the nature of buying and other features of buyer behaviour. After such a study, make your mind clear and informed of the nature of the lifestyle of people in Australia. Lifestyle of a particular group of customers plays a very important role in designing a business.

There are various small investment opportunities are there in cities like Sydney, Brisbane and Melbourne. We have crafted ten such businesses which have high potential and you can start small and go big. Here are 10 most profitable business to start in Australia:-

Green construction business

In Australia, building is one of the industries which has the potential to generate huge profits in a very short span of time. But, as a business man you should always think a bit unique from what it being provided all the time.

This certainly means the specialisation you could make in the building sector itself. From my research, I would recommend you to start a green construction business in Australia instead of just being a construction company in general.

This is because, Australia is considered to be the forefront player in the green construction industry. Also, the restrictions and rules laid in the country for the construction industry stands as a great influencer for making green construction the more demanded service.

Organic beauty products

While people buy chemical cosmetics, there is at least one in ten who choose organic products. Those people are your target crowd who will constantly buy your product if judged to be the best.

All you have to do is create the beauty products with proper research of materials usage and sell them in attractive packages. Remember, packaging is very important in this type of business. This is due to the originality associated with your product. The use of original materials will not create an appealing look.

Glass and glazing

If there is something famous in Australia, one among the list will be the Glass industry. This could probably be due to the extended use of glass in various areas like residential places, companies etc. Like how China is famous for its innovative products, Australia is known for this huge industry.

All you have to do is to make an entry with adequate investment and plans. Entry here could be a difficult task since the number of competitors is high, but there is an advantage of lessening the need for market research. You don’t really have to thrive into researches to find your potential customers, instead set up your business by the inferences you got through observation of similar companies.

It is found that the business is capable of earning $162, 107 per annum. To be a recognised glass business owner, register yourself with the AGGA. This association will help you move in a better speed or it will take a bit longer time to accept your business in the market.

Language coaching centres

People in Australia are well trained in quite a number of languages and there are about 260 languages spoken there. On a rough scale a person in Australia can speak 4 languages. From my point of view, this is something which has to be kept safe.

A lot of people might wish to learn a new language and, you are the destination for it. Having this fact in mind, you can very well be an owner of a language centre. It is of course important for you to possess little skills of teaching. But this does not really matter as you are only the owner. Appoint qualified teachers for your centre and be the managing person alone. This is profitable business idea in Australia and if you are thinking to start this business then this is absolutely right time to kick start your business venture.

Pools and spa

As mentioned earlier, the lifestyle of people in a country is more important in choosing a business. Australians have proved to be the largest users of pools and spa service. Revenue of $156000 per annum makes the former statement evident. A swimming pool is no more an element which makes a place fit in a luxury list.

This absolutely means the increasing demand for swimming pools and the fact that these pools have become common. Coming to spa, Australians are totally open to this industry. Irrespective of the newness of a company, people will react positively to the start of yours. This is probably because of the fact that people are greatly attracted to a healthy life.

And in a way of boosting a spa business, there is a belief that regular spa can lead to a relaxed life. Having said all these, I would recommend you to invest in a pools and spa business. You don’t have to worry about the frequency of orders as the business binds in a number of services in it.

Real estate business

Over the past few years there have been a number of migrants to Australia. This can be due to various reasons and purposes, but the fact that it has influenced real estate business is what is interesting. Especially in Sydney, the real estate business has outweighed all other businesses in the area.

So, basically you will be owning a company which is service-oriented. A number of immigrants will want to stay in Australia by owning a property there. As a real estate company, the following activities will be done from your side.

  • Assistance in registration of properties
  • Selling and buying a new property
  • Estimating values for various properties

Livestock management

Livestock, a very satisfying topic to include in the category of business for Australia. I should say this is probably the most successful type of business irrespective of the size and investment. Currently, the industry is contributing $16.95 billion to the county’s economy. This number is more than enough to understand the worth of the business in Australia.

Though a simple business, the profit generation capacity is extremely high. If planned and executed in a right way, there are chances to defeat your competitors in the industry and make a monopolistic existence. Being a business related to nature and conservation of the environment, it is highly supported by the government of Australia.

Thus, financial support from the government can also be expected. The business is well suited in Australia because of the past records of the country to be the largest producers of commercial meat. Chances of participating the international trade in extremely high if you step into the business.

Biscuit dough business

This is quite a different concept, but the most appreciated one. You would have come across biscuit making businesses, but not a dough making business. Australians are more likely to buy processed foods from supermarkets. And coming to biscuits, there have been a practice of buying biscuit doughs instead of the biscuit itself.

These ready-made packs have been hiking sales since the start. You can be a producer of these biscuit doughs and supply it to various super markets. Another alternative is to make home deliveries directly to your customers.

By doing so, you clearly eliminate the middlemen costs. I would recommend you to spread your business wide by increasing the varieties of biscuits that could be made from the dough. Include flavours and varieties so that you attract customers with varied choices.

Kitchen innovations

It is needless to explain the intervention of technology and the contribution of it in business. Business firms look for futuristic ideas and opportunities to start a business so that a fresh new idea attracts new customers.

In that way, kitchen tools and new ideas that can be implemented in kitchens has found a place for itself in the business world. These are small tools that can be manufactured and sold. The main reason for choosing this business is the newness which has the potential to accelerate the sales of the business.

Pet care

Pet care business might sound simple and small, but the value of it is totally different in Australia. It is luckily one of the successful industries in the country. The need for a product or service arise when there is a subject associated with it. Clearly, a country without dogs and other pets wouldn’t need pet care service.

Taking this as a criterion, let us move to records confirming the demand for a pet care business in Australia. There are about 24 million pets in Australia and out of this count, about 38% is dogs. People in Australia tend to have more pets than in any other country and the count goes as 20 dogs per 100 people. Now, these records are sufficient enough or you to make further plans to establish a pet care business.

Investment Opportunities by Sector in Australia

Investment Opportunities by Sector in Australia

The Australian Government welcomes foreign investment. As the Australian Government’s investment promotion agency, Austrade works to inform investors about growth opportunities in five areas which play to our strengths, jointly agreed by Australian and S tate and Territory Governments:

  • Agribusiness and food
  • Major infrastructure
  • Tourism infrastructure
  • Resources and energy
  • Advanced manufacturing, services and technology

Within advanced manufacturing, services and technology, Austrade focuses on highlighting growth opportunities for investment in Australian medical and materials sciences and technologies, and digital technologies.

Tourism

As the world’s eighth largest national tourism market Australia offers significant opportunities for investment in tourism infrastructure.

Located in the world’s strongest tourism region, in the Asia-Pacific, Australia has a top performing tourism sector with strong revenue from hotel accommodation, high occupancy rates, expanding aviation capacity and strong growth in visitors forecast from emerging Asian markets.

Major Infrastructure

Australia’s growing and resilient economy, increasing population and open trade networks provide a world-class environment for companies to finance, build, own and operate infrastructure assets.

Opportunities exist to apply state-of-the-art technologies and construction expertise to new projects, for upgrading existing infrastructure and investing across all stages of the asset life cycle, ranging from start-up to asset ownership and operation.

Agribusiness and Food

As one of the world’s leading agricultural producers, renowned for safe, healthy and high quality food, Australia is located close to markets in Asia that are driving growing global demand.

Australia offers investors high quality raw inputs and the skills and capabilities needed to undertake world-class research and development and food processing.

Global investors in food and agriculture will find unparalleled opportunities in Australia to service the demand from fast-growing consumer markets for new and innovative premium food products.

Resources and Energy

Australia’s world-class resources and energy sectors attract investment from around the globe. In Australia investors will find a stable and efficient regulatory environment, intellectual property protection, a highly skilled and multi-lingual workforce, and a strong culture of innovation.

Australia has significant reserves of mineral and primary energy resources including iron ore, coal, gas, uranium, wind and solar. This abundance underpins Australia’s position as a major global exporter of minerals and energy resources and products.

Australia’s resources sector is in a period of significant growth as it moves from the investment phase to the production phase of the mining boom. As major projects are completed, the iron ore, coal and LNG sectors will experience a large-scale ramp-up in production capacity.

Digital Economy and ICT

Australia’s fast-growing and highly advanced digital economy, supported by a skilled information and communication technologies (ICT) workforce and world-class research and development (R&D) facilities, offers compelling investment opportunities.

Some of the world’s leading companies have already chosen Australia as a strategic location for investing in ICT, R&D and as a base for connecting with the Asia-Pacific region.

Australia’s economic and research strengths, when combined with robust cyber-security, privacy and intellectual property laws and generous R&D tax incentives, make our country an attractive destination for investment.

Medical Science and Technologies

Excellent research facilities, world-class scientists, and a strong but flexible regulatory regime are qualities that have made Australia a global leader in medical science and technologies, offering breakthrough research solutions and partnership opportunities.

From the medical use of penicillin and cochlear implants to more recent breakthroughs in cervical cancer and the bionic eye, Australia has a proven track record and is a world-leading destination for medical research including in biotechnology, pharmaceuticals, diagnostics and clinical trials.

Materials Science and Technologies

With high-quality research institutions, specialist research and problem solving skills and strong capabilities in materials science and technologies, Australia offers global companies a proven track record and the opportunity to develop the materials of the future.

Australia’s integrated research infrastructure and collaborative research models makes it a preferred research partner, both in established European and US markets and across Asia.

Conclusion

I hope you got some value from this article: Investment Opportunities by Sector in Australia. If you would like additional information, please contact our office HERE. Also, I would like to share a few articles I hope you will enjoy on Australia!

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