Various corporate actions require a company to be valued. For instance, the Companies Act, 2013 mandates valuation by a registered valuer in the case of a new issue of shares, mergers and amalgamations or debt restructuring. Likewise, the FDI guidelines under FEMA provide for valuation if shares are issued by an unlisted company to a non-resident investor.

Registered valuers are appointed to work out an estimated value of the company. Various factors, such as the company’s growth rate, financials, market, competitors, and nature of the business, are considered to determine the value.

The findings of the valuer and supporting information assessed by the valuer are disclosed in a valuation report.