The field of finance plays a critical role in supporting the backbone of a business, just like the field of science is the backbone of technological innovation.
Nithya Ranganathan, our next pathbreaker, Financial Modeller at one of the most diversified Energy Companies in the world, works on M&A (Mergers & Acquisitions) valuation and modelling related deals across the company’s geographies and streams.
Nithya talks to Shyam Krishnamurthy from The Interview Portal about taking up a career in Commerce for its more generalistic approach to analyzing businesses and strategic decisions across the world.
For students, don’t take up a career in finance as an alternative or a backup. Instead, focus on leveraging your strengths to understand the big picture of how businesses grow, expand and flourish !
Nithya, where are you from and a little bit about yourself?
Though I have travelled across the country during my growing up years, the majority of my studies happened in Delhi. Being from a typical South Indian Tamilian family, there was always a lot of emphasis on good education. A good education meant a good independent life. Only a few years back, I moved to the south to stay closer to my parents, who settled in Coimbatore after retirement. Currently, I am working in Chennai with Shell in the field of Financial Modelling. In my free time I like to read, sketch, paint and pursue photography.
I was always a curious child, the brunt of which my mother faced the most. Due to my curiosity and my creative pursuits of sketching and photography, I have been very observant. I always wanted to be up to date with everything around me and had a strong opinion. My family never discouraged me to speak up and express myself because of which I always did things off the beaten path.
Like any other 90s student who was good in academics, it was understood that I would take up the science stream and pursue medical or engineering. That was an obvious expectation that my teachers and my parents had of me. I too assumed science was the route to take. However, my school was more known for its great commerce faculty. So, after my 10th board exams, I applied to other schools but unfortunately didn’t get admission in science. As destiny would have it, I ended up taking commerce in my current school. This was indeed a shock to my parents, teachers and friends. But looking back, it was probably one of the best decisions I took because I enjoyed studying commerce. I felt subjects like business studies, accounting, economics etc. taught one life skills that can help you directly relate to what is happening around the world. Thanks to my dedicated teachers in commerce, this is when my love affair with finance started.
What did you do for graduation/post graduation?
After my 12th standard, I opted to do business management with specialization in finance. Most of my classmates went on to pursue B.Com or Economics whereas I took a less travelled route of doing BBA finance from Amity University, one of the few institutes that offered specialization at a graduation level. Since I wanted to do an MBA in finance, I felt that doing BBA would be the right step forward. It was a three-year professional course and it was nothing like the college life that you generally hear about. The attendance was mandatory, no proxies, and last but not the least, exams were not the only basis on which you were evaluated. The curriculum involved projects, group assignments, case studies and presentations, each of which counted towards your final grade. Though it was scary at first, I eventually started enjoying the confidence I was gaining in the process. I did very well in academics and my belief in making a career in finance strengthened further.
Since I wanted to do an MBA after my graduation, I didn’t sit for any placements and started preparing for competitive exams while completing my last semester in BBA. I got through ICFAI Hyderabad in my second attempt and went on to pursue an MBA in Finance. The fact that I was staying alone and being exposed to classmates who came from varied fields and experiences helped me evolve as an individual. I became more open to newer experiences, accepted failures better and continued to hone my networking skills. While BBA was more about preparing me technically for hard skills in finance, my MBA journey helped me cultivate soft skills – how to put forth your ideas, how to work in a team, how to take initiatives etc. which are a must for the corporate world.
What made you choose such an offbeat, unconventional and unique career?
I think the process that led me to choose the field of finance was quite organic. The decision of taking commerce over science was a tough one and I will have to thank my sister who encouraged me to go with my gut feeling. Once I took that step, I didn’t look back at all. I started liking the complexity yet the practicality of finance. I say complex because there are multiple factors that you need to analyze to understand a problem (very much like science). Albeit, there is no single answer, as all your technical data is dependent heavily on human sentiments, which is not easy to predict. Very simply said, the price of an item might be constant but the value that person A derives out of it differs from how person B values the same item.
In the initial days of 11th standard itself I became quite clear that this is the field I wanted to pursue. A lot of that credit for making the subjects interesting goes to my school faculty. And being from a middle-class family, the seeds of finance were already in my genes because my parents were masters in financial management.
I remember one specific incident when my father (who is a stock market enthusiast) gave me a list of companies with some financial data and asked me to tell him in which company’s stock he should invest. I studied the numbers and went back to him with my selection and explained to him how I shortlisted the best stock. He was quite impressed and let me tell you, it is not easy to impress my father in stock picking. At that moment, I knew I had taken the right decision.
How did you plan the steps to get into the career you wanted? Or how did you make a transition to a new career? Tell us about your career path
My first professional experience came in the form of an internship with Fabindia during my BBA. I was assigned to analyze the costs incurred in warehousing to recommend whether a regional warehouse or a centralized warehouse was more economical. The project involved understanding Fabindia’s business, and the kind of products they sold. Though I was sitting long hours in the non air-conditioned warehouse to understand logistics, I was enjoying the thrill of playing with numbers and analyzing them. I had a tough mentor and those learnings of looking in-between the numbers, and not accepting anything without proper documentation did set a tone for my working culture that I follow till date.
I graduated with my MBA in the not so great year 2009, there was a global financial crisis and a huge impact was felt in the banking and financial services industry. Being a finance graduate, it is needless to say that most of the job offers are rolled out by banking and financial services companies. There was a hiring freeze as well as job cuts across India and abroad. Our college placements took a big hit. My college had a batch size of 900+ students and I was definitely not the brightest of all to be picked up by companies. Most finance professionals were offered jobs with a marketing mix and I was pretty clear that I wanted a core finance job because marketing was not my cup of tea. I wasn’t willing to compromise on the job profile, which meant that I had to leave the campus without a job in hand. When I look back, I think I made a very bold choice, something that I did regret in the short term as I was jobless for almost 5 months after graduation, with an education loan to be repaid. My self-esteem hit rock bottom during that phase, but I had my family and close friends to support me through this phase.
The wait led me to my first job at Sobhagya Capital Options Limited, in the field of merchant banking, a niche field in finance albeit a popular one among finance aspirants. As a Merchant Banker, the primary activity was to act as an intermediary between companies and stock exchanges. Merchant bankers generally act as the compliance consultants who help companies to meet the various regulatory requirements, carry out financial due diligence and with advise on various fund-raising activities. The bigger Merchant bankers generally undertake activities such as IPO, Qualified Institutional Placement etc. whereas my firm handled activities such as buybacks, takeovers, and rights issues. Another key activity we carried out was valuations for various purposes (ESOPs, fairness opinions, delisting, Accounting, SEBI & RBI Disclosures etc.) for listed as well as unlisted firms both India and abroad. Since most of these companies we dealt with were niche private companies, getting data and understanding the industry was challenging. This is how I was exposed to the field of valuation and financial modelling, wherein no one project was similar to the other.
However, being a smaller firm, I was missing the exposure, so i moved to KPMG Global to work in their M&A Research and Analysis wing. It was quite a big change for me, from a small Indian firm to a large MNC kind of a culture. I had to completely unlearn and relearn new ways of working. But in my excitement to join a bigger company / bigger name, I took up a profile which was not purely finance (maybe it was a fear I carried from my placement time to not let go of opportunities even if they don’t excite you). I quickly realized that I wasn’t using my strengths to my full potential and made a quick switch to EY GDS, in the M&A Valuation and Modelling team.
I spent almost 5 plus years in EY in their Gurgaon and Kochi offices and I attribute this phase as the most challenging and rewarding professional experience. I grew up professionally in this role and became more and more confident each passing day. The role was demanding and exhausting, working 24*7, literally having your meals in front of your laptop, challenging stakeholders, demanding teams – everything that you can expect in a high-pressure job. But I stayed on because I was enjoying the learning I was getting. My role basically involved working with Audit and non-Audit clients of EY in supporting and vetting their valuations which are mandated for financial and tax reporting purposes. We followed a step by step process testing client assumptions and forecast comparisons, conducting company research followed by competitor analysis, conducting research on industry and economy, identifying intangible assets, allocating revenue streams to intangible assets, building the model from scratch detailing every aspect of the assets and liabilities, and preparing the final valuation report. We used different valuation approaches (market, cost and income approaches) to estimate and value businesses.
My next switch came at a time when I was losing my motivation to work as a consultant. I wanted to explore what happens at a corporate level and see how the solutions / services we offered as consultants were being implemented and converted into success stories. I moved to Shell in 2019 and I have just completed 2 years with the firm. The challenges I faced as a consultant in the Valuation and Modelling space helped me establish my technical expertise here. But the corporate culture is quite different from the consulting space and just having finance skills is not sufficient. The business demanded me to understand the industry and give solutions that are fit for the purpose. Now after 11 years of work experience in the same field, I still continue to learn, unlearn and relearn, which is the one thing that keeps me motivated.
None of the four jobs that I have had in my career till date have been through referrals. So, I have been lucky that way because networking is not a skill I possess. However, a lot of people say that networking is extremely important in today’s world and I do agree with that. I haven’t learnt that skill well but my journey has started.
How did you get your first break?
My first break/ job was in merchant banking, which was a role I came to know via a job site. It was a small (less than 5 years old) company which carried out capital market related activities as an intermediary. Joining a smaller company as your first job is both challenging and rewarding. Challenging because it is not a known brand in the market but rewarding because you learn a lot as you wear multiple hats.
What were some of the challenges you faced? How did you address them?
In a small company you do not have set processes, procedures nor is there a defined hierarchy. I was reporting to the Director of the company who was decades senior to me. There was never a formal training process, I was directly called into client meetings, asked to answer tough questions, and deliver quick results etc. And to top it all, I was a fresher and started off with a lack of self-confidence. So, I fell, failed, got up and learnt the hard way. I was on my own, so every success that I had, boosted my confidence and every failure I had, I learnt from it. Though I made a lot of mistakes by learning and doing, I made sure I did not repeat the same mistakes. That principle continues to be my foundation till date. I am allowed to make new mistakes but never repeat the old ones.
Another challenge which is very common in Indian companies, especially that are not professionally managed, is that your boss has the ultimate say. Being a person with a strong opinion becomes difficult. This often led to clashes with my boss, but I relentlessly put forth my suggestions irrespective of the backlashes I faced. Eventually my boss actually started asking for my suggestions.
Where do you work now? What problems do you solve?
I currently work as a Financial Modelling lead in Shell, Chennai. I largely work on M&A valuation and modelling related deals across Shell geographies and streams. As a lead I am also responsible for my team, doing stakeholder management, relationship building, work allocation and team admin.
In a particular day/ week, most of my activities revolve around managing projects/ deals that have been assigned to me along with a good mix of team management and admin responsibilities. A project basically means building an excel model or template which captures the deal numbers and assigns a particular quantitative number to the business. This means understanding the business, justifying the assumptions, quantifying the qualitative aspects, and estimating the risk involved. In the field of valuation there are no right or wrong answers, it is all subjective to the valuer. Hence, the background study and documentation that you do becomes the most critical part of the project. Your job is not done if you can’t justify the numbers in the model. Generally, there are 2-3 projects on which I work simultaneously and that may go up to 4-5 projects during busy times. In terms of team management, I manage the project inflow, carry out work allocation, project deferrals, manage stakeholder expectations, negotiate timelines, take care of people management issues & training needs, performance appraisals for the team, represent the team as lead in various forums etc. A typical day would largely involve a lot of meetings and calls to streamline workload management, mentor and guide team members and execute projects in hand.
My role requires me to have a combination of hard technical skills and soft skills. Technical finance skills is something I started learning right from my 11th standard and continue to hone them through all the roles I have held. As a finance or especially a valuation and modelling professional, we work with numbers and hands on knowledge in excel is a prerequisite. Other than that, you need to be highly critical, question every number on the sheet, seek explanations, be analytical and be fact driven. Anything that cannot be backed up my numbers becomes out of your purview, so we have to make sure that we assign a number to everything that will drive the valuation of the business. On the softer aspects, I have to multi-task, be a good listener, be solution oriented and have the ability to mentor and guide team members. Again, I learnt all these skills over a period of time through my experiences. One thing that I can add is that my interests in painting and photography played a big role in making me observant, which ultimately helped me immensely in fine tuning my softer skills.
How does your work benefit society?
I believe that money well spent is money well earned. I might sound materialistic but that’s what my role is all about. Money is a scarce resource, so putting it in a wise space is the best decision for the economy and business as a whole. The finance field is a critical support function, the backbone of a business. Though we work from behind the scenes our contribution is significant. There are some tough decisions you will have to make which may not please a lot of people. But if you are one who stands by facts and figures to tell your story, and can hold on to your work ethics under pressure, finance can be your calling.
Tell us an example of a specific memorable work you did that is very close to you!
This was when I was working with EY where I was supporting the US teams. The company had a practice of sending candidates to the US every year for a short period (generally 3 months), secondment, especially during the busy audit filling time to manage workload. I was sent to the Central US offices (Chicago, Detroit and Cleveland) and it is one of the toughest offices to be in, and no secondment had happened in around 3-4 years prior to mine. During my secondment, there was a project that came to Detroit, so the senior manager asked me to fly to Detroit so that we could work more collaboratively. The senior manager was happy with my work and decided to take me to the client office to directly interact with the company leads. This was an opportunity that younger team members are typically not given, plus even the team in Detroit were not given the opportunity. The project went off well, my contribution was very much appreciated and became a talking point of the leadership group as they hadn’t received such positive feedback from any of the US central offices till date. This experience did instill a lot of confidence in me.
Your advice to students based on your experience?
Freshers generally have this notion that they will get a job wherein they can directly start applying the theories they learn in college. In reality it doesn’t work that way. A lot of theoretical concepts are challenged day in day out. So, you may feel you know what you are doing but there will always be a different way to look at things. So, make sure you do your homework and research very well. That said, sometimes you will have to fight to prove your point and sometimes you will need to accept others’ viewpoints, if you find it more relevant.
All companies have their operations and processes that they follow. As an individual and employee, if you see benefits in doing it differently, don’t hesitate to challenge that without belittling anything or anyone. That fine balance is very hard to strike especially when you start off. It is a skill you cannot be taught, but something you will learn over the years – what to say, when to say and how to say? But the ground rule is, if you have a strong basis for your suggestion and are respectful, there would be quite a high probability that people will listen to you.
The world we work in now-a-days is quite dynamic, so never stop learning. Today excel modelling has become a prerequisite for M&A (Mergers & Acquisitions) finance jobs. But there are digital tools like Power BI, SAP Analytics etc. which help you tell your story not via numbers or excel sheets but through graphs and pictures. So, it is important to become specialists but simultaneously be flexible to pick up new skills along the way.
Never make your career your life. I think it is a very important advice I can give to every student, irrespective of whatever field they are targeting. Your career is just one aspect of your life, make sure to have other interests and passions to pursue. End of the day, if you have to define yourself, let it be a sum total of all the things you do not just the profession to hold.
I would like to continue to explore more facets of finance and see how I can help organizations create valuable strategic decisions. I also have a keen interest in training and developing both hard (technical) and soft (interpersonal) skills. Also, I haven’t contributed much in terms of doing something for the society at large. I wish to work towards these two goals in the coming few years.