Where resources abound, we should expect development that is why limited financial resources seems to be the main deterrents for businesses to develop. Since the banking system can’t afford all required resources for financing, capital markets role in this play seems like an indispensable necessity and in this market securities are major financing instruments, According to IRI securities market law, companies are intermediaries between security issuers and public investors and through the publishing process, they can provide services as consulting, underwriting, firm commitment and market making.

In general, financing method falls into two categories, equity financing and debt financing.

Debt instruments

Debt financing occurs when a firm raises money for working capital or capital expenditures by selling debt instruments to individuals and/or institutional investors. Among the many benefits, debt financing causes tax shield, no dilution would happen (specifically when funds are required for a limited period of time) and residual income is preserved. However, using debt financing while reducing corporate free cash flow and increasing credit risk requires having sufficient collateral.

Equity instruments

In equity financing, required funds are supplied from equity of shareholders and investors are owners of the company. Using equity financing makes the cooperation stronger in financial resources, enhances credit position and provides long-term resources.

Financial Advisory Services

Our financing advisors at Mellat IB are eager to help you through each and every step of financing process by analyzing and reviewing existing approaches to customer needs and responding to any other consulting requests.