Valuation - FDI

Service Description

The Foreign Exchange Management Act (FEMA) in India regulates the issue of shares by Indian companies to foreign investors. According to FEMA regulations, the price at which shares are issued to foreign investors must not be less than the fair market value of the shares. The fair market value of shares is determined by a valuation report prepared by a registered valuer. The valuation report must take into consideration various factors such as the company's financial statements, future growth prospects, market conditions, and other relevant factors. The valuation must be conducted as per internationally accepted valuation methods, such as the discounted cash flow method, the market multiple method, or the net asset value method. Once the valuation report is prepared, the foreign investor can apply for the issuance of shares to the Reserve Bank of India (RBI) through an authorized dealer bank. The RBI will then consider the application and issue necessary approvals. It is important to note that the valuation report must be prepared by a registered valuer who is a member of a recognized professional body in India. The valuer must also comply with the requirements of the Companies Act, 2013, and other applicable laws and regulations. Any Questions? Please write to us @ info@casnj.com or call us at 9845840207