VALUATIONS Presented by Chander Sawhney
What is Valuation <ul><li>In general terms, valuation is determining the “tentative worth”. </li></ul><ul><li>In finance, ...
 
Merger Valuations Require more branding , credentials  and Client Focus Description of existing  products Well Developed A...
CCI Valuations <ul><li>CCI valuation is required when further allotment/transfer of Equity shares between a Resident and N...
<ul><li>Business valuation is a very wide and a specialized area used to determine the overall value of a business/entity....
Private Equity Valuations <ul><li>PE valuation is a specialized form of valuation requiring understanding of all aspects o...
<ul><li>Fair Opinion in Merger for In principle approval </li></ul><ul><li>Recent requirement of taking  Fair Opinion from...
<ul><li>Determination of base price on BSE post restructuring in case of restructuring cases like Reduction, Revocation an...
<ul><li>There are  different situations and purposes  for which an asset/entity is valued (e.g.  M&A, Investment-PE/FDI ,L...
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Cp knowledge: valuation 29.11.2008

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Cp knowledge: valuation 29.11.2008

  1. 1. VALUATIONS Presented by Chander Sawhney
  2. 2. What is Valuation <ul><li>In general terms, valuation is determining the “tentative worth”. </li></ul><ul><li>In finance, Valuation is process of estimating the FAIR VALUE of an asset/entity. </li></ul><ul><li>Valuations are required in many contexts like for </li></ul><ul><li>M&A transactions, </li></ul><ul><li>FDI/Investment outside India/Transfer from Resident to NR/NR to Resident, </li></ul><ul><li>Business Valuations, </li></ul><ul><li>PE deals, </li></ul><ul><li>Litigation cases (397/398), </li></ul><ul><li>MERCHANT BANKING </li></ul>
  3. 4. Merger Valuations Require more branding , credentials and Client Focus Description of existing products Well Developed Area Still in developing phase
  4. 5. CCI Valuations <ul><li>CCI valuation is required when further allotment/transfer of Equity shares between a Resident and Non Resident is involved. </li></ul><ul><li>With increasing global transactions, CCI valuations are gaining popularity. </li></ul><ul><li>By grabbing this opportunity, we are providing services regarding CCI Valuation. </li></ul><ul><li>This area is well developed and we look further to expand more into it. </li></ul>
  5. 6. <ul><li>Business valuation is a very wide and a specialized area used to determine the overall value of a business/entity. </li></ul><ul><li>It requires understanding of practical aspects of </li></ul><ul><ul><li>Valuation Fundamentals, </li></ul></ul><ul><ul><li>Industry Knowledge , </li></ul></ul><ul><ul><li>Specific business commercial and technical operations , </li></ul></ul><ul><ul><li>Valuing management integrity, </li></ul></ul><ul><ul><li>Brand value i.e. value of intangibles and contingent gains/liabilities </li></ul></ul><ul><ul><li>Analysis of financial parameters like EPS, PE multiples, EBITDA Turnover ratios, Discounted Cash Flow analysis, Debt Equity mix etc </li></ul></ul><ul><li>It can be developed by us with more initiative and research with assistance of our industry research database, credentials and specific client focus . </li></ul>Business Valuations
  6. 7. Private Equity Valuations <ul><li>PE valuation is a specialized form of valuation requiring understanding of all aspects of BUSINESS VALUATION. </li></ul><ul><li>Our Focus should be on DEAL MAKING as a whole and not merely on IM preparation so that it becomes a source of high revenue area to our organisation. </li></ul><ul><li>Requirements: </li></ul><ul><ul><li>Strong Liaoning ability and Contacts to sell the equity shares to possible investors </li></ul></ul><ul><ul><li>Specific Client focus </li></ul></ul>
  7. 8. <ul><li>Fair Opinion in Merger for In principle approval </li></ul><ul><li>Recent requirement of taking Fair Opinion from MB for taking 24(f) approval from Stock Exchange in case of merger between Listed and unlisted Company </li></ul><ul><li>ESOP Valuations </li></ul><ul><li>As per Rule 40C of Income Tax Rules, certification by MB for determining the FMV where the equity shares are not listed on any recognized stock exchange/in case of valuation of specified securities other than equity shares(Rule 40D) </li></ul>Merchant Banking Valuations(New Avenues)
  8. 9. <ul><li>Determination of base price on BSE post restructuring in case of restructuring cases like Reduction, Revocation and Demerger </li></ul><ul><li>FEMA Valuations of Equity Shares in case of : </li></ul><ul><ul><li>Investment outside India > USD 5mn for acquisition of Existing Foreign Company </li></ul></ul><ul><ul><li>Investment outside India by Swap of shares </li></ul></ul><ul><ul><li>IPO Valuations and restructuring </li></ul></ul>Merchant Banking Valuations
  9. 10. <ul><li>There are different situations and purposes for which an asset/entity is valued (e.g. M&A, Investment-PE/FDI ,Litigation cases, misc. statutory requirements, MB Valuations etc.) Additionally at times voluntary business/equity valuations are asked for. </li></ul><ul><li>All valuation models and methods have their own limitations. In case of closely held companies exchange ratio is generally not an issue. However in case of merger/dilution to unrelated entities/PE Deals valuation is questioned at every stage and is practically arrived at a negotiated figure. </li></ul><ul><li>In all valuation models there are a great number of assumptions that need to be made and things might not turn out the way you expect. The best way out of that is to be able to explain and justify each assumption you make in light of the practical circumstances and as per the mood of the market. </li></ul><ul><li>..…………………………….…THANK YOU…………..…………………….. </li></ul>Conclusion

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