Corporate valuations are a need to meet regulatory requirements and also for voluntary purposes for financial activities including M&A. The uncertainty across global markets has increased the importance of independent valuations.
Corporate valuations are a need to meet regulatory requirements and also for voluntary purposes for financial activities including M&A. The uncertainty across global markets has increased the importance of independent valuations. Estimating the worth of a business is complex, as it is a combination of factors like purpose industry, strengths, management, promoters, etc. The worth of a company is determined by its business model supported with reasons that directly or indirectly have an impact on its current market standing and future prospects.
There are a variety of business valuation methods categorized into approaches that are applied to arrive at a conclusion. Value is different from price and varies with purpose and time making the field highly subjective. In a business valuation exercise, a number of models are considered which are reconciled to arrive at a conclusion. These valuation models include asset approach, income approach, and market approach. Valuation is subjective more so, for unlisted and private companies with limited judicial guidance.
Business valuations are often misunderstood and put people in confusion, especially when it comes to closely held companies. The definition will vary depending on for whom the evaluation is being carried, it can be from buyer side or seller side. To carry a business valuation successfully, years of experience and practical knowledge is needed. As the value is on a specific date, it only adds to the confusion making valuations complex.
Valuation of publicly traded securities is a definite science part of syllabus. Varying economic conditions make financial data outdated soon, causing an effect on the online valuation of a companies in India adding to subjective nature of closely held companies. This the reason valuation by a registered valuer is considered standard and is a must as per the companies Act, 2013 for sale-purchase, merger, stock option allotment etc.
The valuation for a merger which is a combination of equals is considerably different from a sale-purchase as in each case the objectives are also different. In a company sale-purchase in India, it is more about future prospects for manufacturing industry value of heavy equipment is also critical in the evaluation. Estimating the net value of a closely held business is a challenge and that is where valuation services are handy.
Corporate CapitalVentures Pvt. Ltd, a Sebi Registered (Cat-I) Merchant banker provides valuations for company merger, stock options, and sale-purchase decisions. CCV is also known for consultancy services relating SEBI compliance, FEMA compliance, company law compliance, and RBI matters.
Role of corporate consultants in the era of growing markets
The corporate consultancies help their clients comply with these governing bodies for smooth functioning of trade activities.
Know about consultancy services for compliance management of a company
Compliances are applicable to every company irrespective of size, objectives, and capital structure. Smaller companies lack professional support for such compliance and are subject to risk. A formidable option in such situation is to appoint corporate consultants which charge a fee depending on compliance reducing the need of hiring a specified group of in-house professionals.
Regulatory Procedure for Delisting from Regional Stock Exchange
With emergence of nationwide trading terminals, regional exchanges have lost their relevance also SEBI has de-recognized majority of them. Most companies listed on a regional exchange seek delisting to avoid regulatory obligations and do away with the listing fee.
