What is the significance of valuation during fundraising?

It helps assess how much equity to offer in exchange for capital, ensuring fair deals for investors and owners.

What is the Valuation Date?

Valuation date is the specific date at which the valuer estimates the value of the underlying asset.

Is a valuation report older than 90 days acceptable for a FEMA transaction?

The valuation certificate issued by SEBI registered Merchant Banker must not be more than ninety days old as on the date of the transfer.

Is valuation required for joint ventures?

Yes, valuations help determine each partner’s contribution and ownership share in joint ventures.

How does valuation support strategic decision-making?

Valuation provides insights into asset worth, enabling businesses to prioritize investments, divestitures, and expansions.

When is a valuation required?

Valuation may be required for mergers and acquisitions, fundraising, regulatory requirements, litigation, and other purposes such as financial reporting and strategic planning.

How often should valuations be updated?

The frequency of valuation updates depends on the purpose. For financial reporting, it might be annual; for dynamic and high-growth sectors, more frequent updates may be needed.

Are valuations required for startups?

Yes, valuations are particularly important for startups for various purposes including fundraising, equity distribution among founders and employees, and strategic planning.

How often should startups conduct valuations?

Startups should perform valuations during each fundraising round, or whenever there is significant business growth.