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Last updated: 14 Oct 2026

Virtual Auditor

Share Valuation Services

Last updated: 14 Oct 2026

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Share valuation determines the fair market value of a company\'s shares — including equity shares, preference shares (CCPS, OCPS, RPS), and convertible instruments (CCD, iSAFE, convertible notes). Different regulatory frameworks prescribe different methods and standards: Rule 11UA (prescribed methods such as NAV or DCF), FEMA (any internationally accepted method), Companies Act (Registered Valuer), SEBI (prescribed formulae for listed), and IBC (fair value and liquidation value). Virtual Auditor as an IBBI Registered Valuer delivers share valuations that satisfy all applicable frameworks in a single report. Quick Answer: Share Valuation Services — Share valuation by IBBI Registered Valuer. Equity shares, preference shares, CCPS, OCPS, convertible notes. Rule 11UA, FEMA, Companies Act compliant. Virtual Auditor.

What is Share Valuation Services?

Regulatory Framework

Regulatory basis: Section 247 of the Companies Act, 2013 read with the Companies (Registered Valuers and Valuation) Rules, 2017; ICAI Valuation Standards, 2018 and International Valuation Standards.

Scope of Services

NAV Method (Rule 11UA) DCF Method (FEMA/Rule 11UA) Comparable Company Analysis Comparable Transaction Analysis Option Pricing Model (for CCPS/convertibles) Black-Scholes (for warrants/options) Binomial Lattice Liquidation Waterfall Analysis DLOM — Chaffe / Finnerty Monte Carlo Simulation

Indicative Fee Structure

ServiceFee
Equity Share Valuation (single framework)Starts from ₹35,000 + 18% GST
Multi-Framework (FEMA + Rule 11UA)Starts from ₹60,000 + 18% GST
Preference Share / Convertible ValuationStarts from ₹50,000 + 18% GST

*Prices are indicative. Actual fees depend on complexity, capital structure, and regulatory requirements. Contact us for a detailed quote.

Share Valuation — Equity vs Preference vs Complex

TypePrimary MethodKey Consideration
Equity shares (listed)Market price (VWAP)Use 26-week or 2-week VWAP as applicable
Equity shares (unlisted)DCF or NAV per Rule 11UAMust use RBI/FEMA floor for FDI
CCPS / OCPSOPM or PWERMConversion rights, liquidation preference
iSAFE / SAFEScenario-weightedDiscount rate, valuation cap, trigger events

Engagement terms — reviewed 25 October 2026

  • Fee: From ₹35,000 + 18% GST per report. No government fee applies to a valuation report.
  • Extra / not included: A revised report after a change in the valuation date, the instrument terms or the purpose is a fresh engagement.
  • Turnaround: 7 working days from receipt of complete information and the advance payment.
  • Who signs: The report is signed by V. Viswanathan, IBBI Registered Valuer (IBBI/RV/03/2019/12333).
  • Entity: Engagement letter and invoice are issued by V Viswanathan & Associates (proprietor V. Viswanathan, IBBI Registered Valuer, IBBI/RV/03/2019/12333); the Registered Valuer is appointed and signs in his personal capacity, not through a company.
  • What to send first: Send latest audited financial statements, current cap table, management projections, and the term sheet or the purpose the report is for (Companies Act, FEMA, income-tax, transaction).
  • Next step: Send your enquiry on WhatsApp to +91 99622 60333; we confirm the scope, fee and timeline in writing before work starts.

Step-by-Step Process

    Step 1

    Determine purpose (tax, FEMA, Companies Act)

      Step 2

      Collect shareholders agreement and cap table

        Step 3

        Apply applicable pricing methodology

          Step 4

          Cross-validate across regulatory frameworks

            Step 5

            Issue valuation certificate with regulatory references

            When Is Share Valuation Services Not Required?

            An independent share valuation may not be required when: (a) shares are listed and market price is accepted by all parties and regulators, (b) a recent valuation (within 6 months) already exists and no material change has occurred, (c) the transaction is between related parties at book value with no regulatory requirement for independent valuation, or (d) the applicable regulation provides a safe harbour or deemed valuation formula. However, income tax scrutiny risk increases significantly for unlisted share transactions without an independent valuation.

            If you are unsure whether your situation requires share valuation services, contact us for a free preliminary assessment. We will advise you honestly — including telling you if you do not need our services.

            Documents Required

            The following documents are needed to initiate the share valuation services process:

            PAN card and Aadhaar of the entity/promoters, Certificate of Incorporation/Registration, last 3 years audited financial statements (with schedules and notes), shareholding pattern as on valuation date, details of any recent transactions in shares (last 2 years), business plan or financial projections (for DCF-based valuations), cap table with complete history of share issuances, and any regulatory correspondence relevant to the valuation purpose.

            We provide a personalised document checklist after the initial consultation, tailored to your specific entity type and situation. Documents can be shared securely via email or our client portal.

            What You Will Receive

            Upon completion, you will receive: Share valuation report compliant with Rule 11UA / Companies Act / FEMA NDI Rules (as applicable), fair market value per share with supporting computation, methodology documentation (DCF, NAV, comparable transaction), discount and premium analysis (DLOM, control premium, size premium), cap table impact analysis if applicable, and compliance certificate for regulatory filing. Report designed for Income Tax scrutiny, NCLT proceedings, or investor negotiations.

            A Recent Client Engagement

            Our approach: A closely-held company in Chennai needed share valuation under Rule 11UA for a fresh share allotment to a new investor at premium. The existing shares had complex features — differential voting rights and anti-dilution provisions. We applied the income approach (DCF) and market approach (comparable transaction multiples from 8 recent deals in the same sector), adjusted for lack of marketability discount (15%) and control premium analysis, and reconciled with the net asset value method as prescribed under Rule 11UA.

            Outcome: Fair market value determined at ₹1,850 per share (face value ₹10). Share premium of ₹1,840/share accepted by the Income Tax Department during scrutiny assessment. Investor subscribed to 50,000 shares — ₹9.25 Cr infusion. No addition under Section 56(2)(viib). Report stood up to AO scrutiny without any adverse inference.

            Updated for FY 2025-26

            This service page reflects the latest regulatory requirements as of March 2026, incorporating changes from the Union Budget 2025, recent MCA notifications, CBDT/CBIC circulars, and RBI master directions applicable to share valuation services. Virtual Auditor continuously monitors regulatory updates to ensure all advice and filings are current.

            Timeline and Turnaround

            Typical turnaround for share valuation services: 5-15 working days from receipt of complete information. Simple single-framework valuations (e.g., Rule 11UA only) can be completed in 5-7 days. Multi-framework valuations (FEMA + IT + Companies Act) typically require 10-15 days. Rush delivery available within 3-5 days at an additional fee for urgent transactions.

            Timelines assume prompt submission of complete documents and information. We provide a clear project timeline at the start of every engagement.

            Penalties for Non-Compliance

            Using incorrect or outdated valuations can result in: (a) rejection of FEMA filings by the AD bank, requiring fresh valuation and re-filing with potential late filing penalties, (b) income tax additions under Section 56(2)(x) for inadequate consideration, attracting tax at slab rate plus interest under Section 234A/B/C, (c) disqualification of the ESOP scheme for non-compliance with Ind AS 102, and (d) personal liability of directors for transactions at undervalued prices under Section 66 of the Insolvency Code.

            Proactive compliance is always cheaper than penalty. Contact Virtual Auditor for a compliance health check to identify and address any gaps before they become liabilities.

            Government Portal and Online Filing

            Filings related to share valuation services are submitted through the relevant government portal. We handle all online filings on your behalf, including portal registration, form preparation, document upload, and acknowledgment tracking. You do not need to navigate the portal yourself — we manage the entire digital interface.

            What has changed in the law — reviewed October 2026

            • Income-tax Act, 2025: assented to on 21 August 2025 and in force from 1 April 2026, it replaces the Income-tax Act, 1961 for tax year 2026-27 onward, and the Income-tax Rules, 2026 (notified 20 March 2026) replace the 1962 Rules. Section and rule numbers on this page are those of the 1961 Act and 1962 Rules, which continue to govern assessments, appeals and pending proceedings for assessment years up to 2026-27; for tax year 2026-27 onward the corresponding provisions of the 2025 Act apply, and our engagement letters quote both.

            Frequently Asked Questions

            What is the difference between share valuation and business valuation?
            Business valuation determines enterprise value (value of the entire business). Share valuation derives per-share value from enterprise value by adjusting for debt, cash, and dividing by total diluted shares. For complex capital structures (CCPS, convertibles), share valuation requires waterfall/OPM modelling beyond simple division.
            Which method does Rule 11UA prescribe for share valuation?
            For unquoted equity shares issued by the company: NAV or DCF at the company’s option (Rule 11UA(2)), with the DCF report from a SEBI Category-I Merchant Banker; for transfers, the adjusted net asset value formula in Rule 11UA(1)(c)(b). For listed shares: closing market price on the valuation date.
            How do you value CCPS (Compulsorily Convertible Preference Shares)?
            CCPS valuation uses Option Pricing Model (OPM) or Probability-Weighted Expected Return Method (PWERM). The OPM treats each share class as a call option on the enterprise value with breakpoints determined by liquidation preferences. Our engine models the full waterfall including anti-dilution provisions.
            When is share valuation needed?
            Share transfer (Section 56(2)(x) IT Act), FEMA transactions (resident to non-resident), ESOP grants (Ind AS 102), Companies Act requirements (Section 62, 230, 232), buyback of shares, and investor transactions (fundraising, exits).
            What methods are used for share valuation?
            Income approach: DCF, Dividend Discount Model. Market approach: Comparable Company Analysis, Comparable Transaction. Asset approach: NAV, Adjusted Book Value. Choice depends on purpose and regulatory requirement.
            Is share valuation needed for gift of shares?
            Yes. Under Section 56(2)(x), if shares are received as gift and FMV exceeds ₹50,000: excess is taxable as income of recipient. Valuation per Rule 11UA required to determine FMV.
            Can share valuation be challenged by tax authorities?
            Yes. AO can reject valuation if assumptions are unreasonable. Most disputes centre on: DCF growth rate, discount rate, and terminal value assumptions. Our Monte Carlo approach provides defensible probability-based results.
            Which report and approach fit this business valuation, share transfer or ownership decision?
            The purpose decides the report and who signs it. A preferential allotment, merger or other valuation required by the Companies Act needs an IBBI Registered Valuer’s report. Foreign investment needs a FEMA pricing certificate from a Chartered Accountant in practice, a SEBI-registered merchant banker or a practising cost accountant. Income-tax value follows the prescribed rule. Insolvency needs two Registered Valuers’ fair and liquidation values. Accounts use fair value under Ind AS 113. A negotiation or family settlement has no statutory format. The approach then follows the business: income approach (discounted cash flow) where future cash flows can be estimated, market approach (listed comparables or transactions) where good comparables exist, and asset approach (net asset value) for holding or asset-heavy companies, with adjustments for control, minority stakes and marketability.
            How many methods should a valuation use?
            Best practice is 3-5 methods with cross-validation. Virtual Auditor deploys up to 18 methods simultaneously and uses Monte Carlo simulation (10,000 iterations) to produce a probability distribution rather than a single point estimate.
            Is a Registered Valuer mandatory for all valuations?
            IBBI Registered Valuer is mandatory for Companies Act (Section 247) and IBC (Regulation 35) valuations. For FEMA and Income Tax, a CA in practice is sufficient, but using a Registered Valuer provides a higher standard.

            Related Services

            Valuation Services by IBBI Registered ValuerBusiness Valuation Services in IndiaShare Buyback Valuation ServicesValuation Report for Share TransferRule 11UA Valuation for Share Premium409A Valuation409A Valuation IndiaAIF Valuation

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