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Methodology

      Enterprise Valuation

We value the enterprise, adopting a combination of business data & mathematical formula based method along with some commonly used valuation, method.

Broadly they are;

  • RETURN ON INVESTMENT METHOD.
  • BALANCE SHEET BASED METHOD
    • GOING CONCERN = ASSTE-LIABILITIES –Applicable in case of continuation of the business.
    • LIQUIDATION OF ASSET VALUE –Applicable in case of immediate sale /winding up of business unit.
    • BOOK VALUATION – This is purely based on Balance sheet items where profit may be low but the Enterprise has high value asset.
  • ROI BASED VALUATION METHOD.-This Return on Investment method is applicable in case investors wish to buy equity or infuse fresh tranche of fund. ROI method gives indication the probable quantum of Return expected on such investment.
  • IV) EARNING CAPITALIZATION METHOD.-Applicable to the business that projects, future profit induced growth scenario based on present cash flow & Annual ROI & expected value. This optimistic model draw its clue from the present stability & good performance in given time frame.
  • V) DISCOUNTED CASH FLOW- DCF –Applicable to understand the future cash flow discounted to the present value. This method also known as Income method is useful when the Enterprise anticipate fluctuation of its profit due to uncertainty/volatility.
  • VI) EARNING MULTIPLIER – This is a time revenue method to assess the value & worth of the business of not very large size , where a multiplier is assigned to the current revenue ,the multiplier being is determined as per Industry, economic scenario etc.
    We may also adopt some complex hybrid method in case a particular method of valiation doesn't manifest the true and fair value of the Enterprice





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