Whatever the reason for establishing and running a company, you will, at some stage, want to know the value of the business. This could be because of one of the following reasons:
- To identify weaknesses
- To determine whether the business is growing, stagnant, or deteriorating
- To apply for a loan
- To attract investors
- To establish a reference point as a platform for driving future growth
- In preparation for divesting from the company
There are several methods of valuation, but the three main methods will be discussed in this chapter.
This chapter will cover the following topics:
- Absolute valuation
- Relative valuation
- Interpreting the results
