Business Valuation Report
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A Business / Company Valuation Report is a formal document that assesses a company’s fair market value at a specific time. This value conside ...
Determine Valuation of the Business
Financial Modeling of business
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Business Valuation Report
Share financial information
Customer shares company’s financial data
Value is calculated
Valuer calculates enterprise valuation
Valuation Report is issued
Merchant Banker issues signed report
Share financial information
Customer shares company’s financial data
Value is calculated
Valuer calculates enterprise valuation
Valuation Report is issued
Merchant Banker issues signed report
Contents of Report
Overview
The name and registration number of the Merchant Banker and details of the company requesting for Business Valuation Report
Scope of Work
Outlines the specific shares being valued, along with any limitations or restrictions on the valuation process.
Methodology
Details about the approaches and methods used to determine the value of the share.
Market Analysis
Information about the relevant market conditions, trends, and factors that may impact the value of the share.
Valuation Results
The final estimated value of the asset, along with any supporting calculations or analyses.
Merchant Banker's Declaration
A statement by the Merchant Banker confirming that the report has been prepared in accordance with relevant laws and standards.
Signature and Stamp
The report is signed by the Merchant Banker, along with their official stamp or seal.
Benefits of Business Valuation Report
Credibility
The report is prepared by a Merchant Banker/Registered Valuer/CA which lends credibility to the valuation process and assurance to stakeholders.
Regulatory Compliance
Business Valuation Report ensures compliance with the provisions of the Income Tax Act, SEBI regulations and RBI guidelines.
Objective and Unbiased Assessment
It provides an impartial and unbiased valuation, free from any conflicts of interest.
Risk Mitigation
Business Valuation Report helps mitigate the risk of disputes or disagreements related to the value of the asset.
Financial Reporting and Accounting
Premium per share as mentioned in the Valuation Report is used for financial reporting purposes as per accounting standards compliance.
Professional Accountability and Ethics
The preparation of a Business Valuation Report demonstrates adherence to these standards, which enhances trust and confidence in the valuation.
Documentation of Methodology and Assumptions
Transparency in method, approach, and assumptions helps stakeholders understand how the value was determined.
Documents Required for Business/Company Valuation
Financial Information
Last 3-5 years of financial statements (balance sheet, income statement, cash flow statement)
Tax Information
Last 2-3 years of tax returns (depending on purpose, e.g., SBA loan) and Owner's personal tax returns (for pass-through entities like LLCs)
Intangible Assets
List of intellectual property (patents, copyrights, trademarks, etc.) and Goodwill
Business Growth Projections
Forecasts for future balance sheets and income statements
Company Formation Documents
Business plan outlining strategic direction. Articles of incorporation or organization and bylaws
Cash Flow Adjustments
Owner's discretionary earnings (personal expenses run through the business)
Photos of facilities and equipment
Recent equipment appraisals (if available)
Details of any legal issues, financial concerns, or ownership complexities
Current lease agreement or real estate appraisal (if applicable)
Information on prior business transactions
Deliverables
Determine Enterprise Valuation
Issue of Valuation Report signed and stamped
Frequently asked Questions
What is a Business Valuation Report?
A Business Valuation Report is a formal document that estimates the fair market value of a company at a specific point in time. This value considers not just the company’s current financial state (assets and liabilities) but also its potential for future growth.
What information does a Business Valuation Report include
The report goes beyond a simple valuation figure. It typically details the valuation methods used (market multiples, discounted cash flow analysis, etc.), analyzes key factors influencing value (financial performance, industry trends, etc.), and presents a final estimated fair market value of the company.
How does a Business Valuation Report determine a company's value?
The report employs various methods like market multiples (comparing the company to similar businesses) or discounted cash flow analysis (projecting future cash flows and discounting them to present value).
What is the EBITDA valuation method?
EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is a common metric used in business valuation, particularly for the Income Approach. It represents a company’s operating profitability. By multiplying the EBITDA by a multiple based on industry averages or recent transactions of similar businesses (EBITDA multiple), you get a valuation estimate. However, this is a simplification, and a full valuation would consider other factors like future growth prospects.
How to value a private company?
Valuing private companies can be more challenging than public companies because there’s less readily available market data. However, the same valuation methods (Income, Market, Asset) can be applied with some adjustments
When do you need a business valuation report?
Consider a valuation report before any major transaction (buying/selling a business), for fundraising, estate planning, or resolving disputes with partners.
What is the validity period of a valuation?
A valuation is like a financial snapshot at a specific date. Its accuracy generally holds for about a year, assuming no major changes in your business or the market.
Why do I need a professional valuation if I have an idea of my business worth?
A professional valuation provides credibility and defensibility for your estimated worth. It uses recognized methods and considers factors you might miss, strengthening your position in negotiations or financial reporting.
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Reviews
4.8
Rahul Kapoor
ezyLegal's business valuation report was instrumental in helping us identify opportunities for growth and expansion. The insights provided us with a clear understanding of our company's strengths and weaknesses, enabling us to capitalize on our competitive advantages and address areas of improvement. I'm grateful for ezyLegal's expertise and dedication to helping businesses like ours succeed. With their support, I'm confident that we'll achieve our growth objectives and create long-term value for our stakeholders.Neha Sharma
ezyLegal's business valuation report provided us with a forward-thinking perspective on our company's value and potential for growth. The insights offered valuable guidance on strategic planning, investment allocation, and risk management, positioning us for success in an increasingly competitive market. I appreciate ezyLegal's commitment to delivering insightful analysis and strategic guidance that drive business growth. With their support, I'm confident that we'll continue to innovate, grow, and achieve our goals.Rohit Verma
ezyLegal's business valuation report was a valuable asset in our strategic planning process. The insights provided us with a clear understanding of our company's value and performance relative to industry benchmarks, enabling us to identify opportunities for growth and improvement. I'm grateful for ezyLegal's support and expertise, which have empowered us to make informed decisions about our business's future. With their guidance, I'm confident that we'll continue to thrive and succeed in the market.Priya Singhania
Trust is essential when it comes to business valuation, and ezyLegal has earned my complete trust with their impeccable service. The business valuation report they provided was not only accurate and reliable but also delivered with transparency and integrity. I appreciate ezyLegal's commitment to providing honest and trustworthy information that we can rely on to make important financial decisions. I wouldn't hesitate to recommend their services to any business in need of reliable valuation solutions.Alok Gupta
ezyLegal's business valuation report provided us with a wealth of information about our company's worth and financial health. The report was comprehensive, covering all aspects of our operations, assets, and liabilities. The insights offered valuable guidance on strategic planning, investment decisions, and exit strategies. I'm grateful for ezyLegal's expertise and dedication to helping businesses like ours succeed. With their support, I'm confident that we'll achieve our financial goals and maximize shareholder value.
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