30/10/2013

Registered ValuerCompanies Act, 2013

Registered Valuers

Registered Valuers

Financial Valuer Technical Valuer

• A Chartered

Accountant, Company

Secretary or Cost

Accountant in whole time

practice or retired member

of Indian Corporate law

Service or any other person

as prescribed.• A Merchant Banker

registered with SEBI and

which has in employment

under it CA/CS/CWA for

carrying out (signing)

Valuation by such qualified

persons.

• Member of the Institute

of Engineers or Member

of the Institute of

Architects in whole time

practice.

• A person or firm or LLP or

Merchant Banker

possessing both

qualifications may act in

dual capacity.

Shall have 5 Years

of Continuous

Experience, Post

Qualification

Shall have 5

Years of

Continues

Experience, Pos

t Qualification

Stock, Shares,

Debentures,

Securities,

Goodwill

Property

Persons eligible to apply for being Registered as Valuer

RegisteredValuer to beappointed byAudit Committeeor in its absenceby the Board ofDirectors.

Registered Valuers

Registered Valuer

Further Issue of Shares

Compromise and

Arrangements

Winding up / Liquidation

Non Cash Transactions

with Directors

Exit to Minority

Shareholders

Corporate Debt

Restructuring

Registered Valuers

(Financial

Valuation)Value

Responsibilities

• Valuer to make impartial, true and fair

valuation

• Not undertake valuation if directly or

indirectly interested

• Exercise due diligence

• Valuation to be done as per rules

Upon contravention

• Fine – 25,000 to 100,000

With intention to defraud

• Imprisonment upto 1 year and

• Fine- 1,00,000 to 5,00,000

Additionally upon contravention, to

refund remuneration received and also

liable for damages.

Section wise Requirement of Registered Valuers

Section 62(1)(c) – For Valuing further Issue of Shares

Section 192(2) – For Valuing Assets involved in Arrangement of Non Cash transactions involving Directors

Section 230(2)(c)(v) – For Valuing Shares, Property and Assets of the company under a Scheme of

Corporate Debt Restructuring

Section 230(3) and 232(2)(d) – For Valuation including Share swap ratio under a Scheme of

Compromise/Arrangement, a copy of Valuation Report by Expert, if any shall be accompanied

Section 232(3)(h) - Where under a Scheme of Compromise/Arrangement the transferor company is a listed

company and the transferee company is an unlisted company, for exit opportunity to the shareholders of

transferor company, valuation may be required to be made by the Tribunal

Section 236(2) – For Valuing Equity Shares held by Minority Shareholders

Section 260(2)(c) – For preparing Valuation report in respect of Shares and Assets to arrive at the Reserve

Price or Lease rent or Share Exchange Ratio for Company Administrator

Section 281(1)(a) – For Valuing Assets for submission of report by Company Liquidator

Section 305(2)(d) – For report on the Assets of the company for preparation of declaration of solvency

under voluntary winding up

Section 319(3)(b) – For Valuing the interest of any dissenting member of the transferor company who did

not vote in favour of the special resolution, as may be required by the Company Liquidator

Section 325(1)(b) – For valuation of annuities and future and contingent liabilities in winding up of

insolvent company

Registered Valuers (Draft Rules) – Methods of Valuation

I. Before adopting methods, decide Valuation Approach-

• Asset Approach

• Income Approach

• Market Approach

II. Valuer to consider following points while undertaking Valuation-

• Nature of the Business and the History of the Enterprise from its inception

• Economic outlook in general and outlook of the specific industry in particular

• Book Value of the stock and the Financial condition of the business

• Earning Capacity of the company

• Dividend-Paying Capacity of the company.

• Goodwill or other Intangible value

• Sales of the stock and the Size of the block of stock to be valued

• Market prices of stock of corporations engaged in the same or a similar line of business

• Contingent Liabilities or substantial legal issues, within India and Abroad, impacting business

• Nature of Instrument proposed to be issued, and nature of transaction contemplated by parties

Registered Valuers (Draft Rules) – Methods of Valuation

III. Registered Valuer shall make valuation of any asset in accordance with any one or more of the

following methods-

a. Net Asset Value Method (NAV)

b. Market Price Method

c. Yield Method / PECV Method

d. Discounted Cash Flow Method (DCF)

e. Comparable Companies Multiples Method (CCM)

f. Comparable Transaction Multiples Method (CTM)

g. Price of Recent Investment Method (PORI)

h. Sum of the parts Valuation Method (SOTP)

i. Liquidation Value

j. Weighted Average Method

k. Any other method accepted or notified by RBI, SEBI or Income Tax Authorities

l. Any other method that valuer may deem fit provided adequate justification for use of suh method (and not

any of the above methods) is provided

IV. Registered Valuer shall make valuation of any asset as on the Valuation date and in accordance

with applicable standards, if any stipulated for this purpose.

V. Contents of Valuation report shall contain information as contained in Form 17.3

Registered Valuers (Forms) – Contents of Valuation report

1) Description of valuation engagement

(a) Name of the client:

(b) Other intended users:

(c) Purpose for valuation:

(2) Description of business/ asset / liability being valued

(a) Nature of business or asset / liability

(b) Legal background

(c) Financial aspects

(d) Tax matters

(3) Description of the information underlying the valuation

(a) Analysis of past results

(b) Budgets, with underlying assumptions

(c) Availability and quality of underlying data

(d) Review of budgets for plausibility

(e) Statement of responsibility for information received

Registered Valuers (Forms) – Contents of Valuation report

(4) Description of specific valuation of assets used in the business:

(a)Basis or bases of value

(b) Valuation Date

(c) Description of the procedures carried out

(d) Principles used in the valuation

(e) The valuation method used and reasoning

(f) Nature, scope and quality of underlying data and

(g) The extent of estimates and assumptions together with considerations underlying them

(5) Confirmation that the valuation has been undertaken in accordance with these Rules

(6) Further it is certified that valuation has been undertaken after taking into account relevant

conditions/regulations/rules/notifications, if any, issued by the Central/State Government(s) from time to time.

(i) The valuation report must clearly state the significant assumptions upon which the value is based.

When reporting there may be instances, where there are confidential figures, these must be

summarized in a separate exhibit

(ii) In his valuation report, the registered valuer must set out a clear value or range of values along with

the reasoning

(ii) In case the valuer has been involved in valuing any part of the subject matter of valuation in the

past, the past valuation report(s) should be attached and referred to herein. In case a different

basis has been adopted for valuation (than adopted in the past), the valuer should justify the

reason for such differences

About

Corporate Professionals

Offering varied legal & financial services, 'Corporate Professionals' has emerged as an innovative leader in

delivering corporate advisory & solutions. Aiming to become a one-stop-shop offering integrated legal and

financial solutions, the Group has successfully completed a high number of corporate transactions in the last

couple of years. We have successfully engaged in and executed over 3000 assignments of more than 1200

corporate houses, domestic as well as international, across several Industries.

The Group has distinctively positioned itself as Merchant Banker (SEBI Cat-I license) with Boutique

Investment Banking & Transaction Advisory services and as Legal Advisors with high quality comprehensive

Corporate Laws, Tax & Regulatory services. With an endeavor to satisfy our clients' stated as well as

unstated needs, we adopt the most feasible and legally viable approach to execute assignments in a

seamless, cost effective and time bound manner. High Integrity and Confidentiality in dealing with clients

and assignments undertaken is deeply inculcated in our team.

The Group prestigiously owns a strong skill set that comes from its research oriented, multi-

disciplinary, young and dynamic team. With right blend of legal and financial skills, continuous focus on

research and effective use of Information Technology, Corporate Professionals is creating customized

products, for different class of clients. Innovative flair of executing assignments with problem solving zeal

and use of Technology has enabled us to offer path breaking solutions. Not just for executing Clients'

Assignments but also in internal management, the Group adheres to a system driven approach.

The Group dedicates around 30% working time of its professional team on continuous research in the

dynamic legal and financial fields, with an object of creating a knowledge hub, extensive knowledge

dissemination and to develop skills of its team to deliver high quality services.

“Corporate Professionals” refers to one or more of group companies and its network of firms and other

entities, each of which is a separate legal, independent entity. For more details, please visit

www.corporateprofessionals.com.

Mr. Chander Sawhney

Vice President

M: +91 9810557353

D: +91 11 40622252

E: chander@indiacp.com

Mr. Maneesh Srivastava

Senior Manager

M: +91 9871026040

D: +91 11 40622255

E: maneesh@indiacp.com

Mr. Gaurav Kumar Barick

Assistant Manager

M: +91 8130141874

D: +91 11 40622241

E: gaurav@indiacp.com

Mr. Sameer Verma

Assistant Manager

M: +91 9911945607

D: +91 11 40622216

E: sameer@indiacp.com

Our Valuation Team

As Close As You Need

As Far As You Go……

Delhi Office

D-28, South Ex., Part-I, New Delhi-110049,

D-38, South Ex., Part-I, New Delhi-110049,

T: +91 11 40622255

M:+ 91 9871026040,

E: info@indiacp.com

Mumbai Office

520, Mastermind- I, Royal Palms Estate, Aarey

Colony,

Goregaon East, Mumbai -400065

T: +91 2267109044

M:+ 91 9820079664

E: mahipal@indiacp.com

Indian Offices

Overseas Offices

Our Associates

India

Ahmedabad, Allahabad, Bangalore, Bhopal, Bhubaneshwar, Chandigarh, Chennai, Coimbatore, Goa, Guwahati, Gwalior, Hydera

bad, Indore, Jaipur, Jammu, Kanpur, Kochi, Kolkata, Lucknow, Ludhiana, Patna, Pune.

Overseas

Bulgaria, Belgium, British Virgin Islands, Canada, China, Costa Rica, Cyprus, European

Union, Germany, Hongkong, Ireland, Japan, Kenya, Malaysia, Mauritius, Singapore, Sri Lanka, Switzerland, The

Netherlands, Turkey, United Arab Emirates, United Kingdom, United States.

Bedford Office (United Kingdom)

2-4 Mill Street, MK40 3HD, Bedford

Switchboard: +44 (0) 2030063240,

E: ukoffice@indiacp.com