Business valuation in Dubai: approaches to keep in mind
Business valuation is a very important factor to consider in various situations. Other than the general exact knowledge of your own business and what it’s worth, keeping the figures of your company’s intrinsic value is highly important in case any market participants are interested in investing in your company.
Other situations include when the company is expecting any mergers, acquisitions and takeovers by another person or entity. In this case, the interested party needs to know exactly what the company is valued at, so that it can make important decisions based on these facts. Once there’s a comprehensive report prepared by a professional valuator, there can be no disagreements on numbers and there will be authentic document on the value of the company.
Business valuation services are provided by Quantum Auditing in Dubai and other Emirates in the UAE. It is reputed as one of the best companies for Business valuation in the GCC region. Company valuation is an extremely crucial task that needs serious evaluators to assess the financials and corollate them with the market trends. Knowing the value of your business also becomes important at the time of bankruptcy, liquidation, raising funds, or while formulating Company exit strategies.
There are multiple approaches and ways to calculate the value of a company. There’s no One Factor that decides what the business would be valued at. This is clearly due to the reason that No One factor dictates the financial statements’ position at one time, with factors such as customer loyalty, market situation, global situation etc affecting the businesses.
Following are the main 3 approaches to value businesses, based on 3 main factors:
- Cost Approach:
The cost (or asset-based) approach derives value from the combined fair market value (FMV) of the business’s net assets.
- Income Approach:
This approach converts future expected economic benefits – generally, cash flow – into a present value. Because this approach bases value on the business’s ability to generate future economic benefits, it’s generally best suited for established, profitable businesses.
- Market Approach:
The market approach bases the value of the subject business on sales of comparable businesses or business interests. It’s especially useful when valuing public companies (or private companies large enough to consider going public) because data on comparable public businesses is readily available.
Quantum Auditing provides you with all the assistance that you need to calculate the intrinsic value of your business, using various financial methods, such as net asset value and discounted cash flows method. However, the calculated figure is subjective because it is based on certain subjective assumptions. We support our assumptions with the given industry data and conclusions from extensive market research. In case of conflicting views, we stand by our clients to justify our basis of valuation. Moreover, our team of analysts has the required experience of estimating the value of companies spread across different industries.