Query under fema

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 December 2011 A company was promoted with an intiail capital subscription of Rs.5,00,000/- and the entire amount was contributed by NRIs. FCGPR was also filed in time. Now the RBI is requesting for a Chartered Accountant's Certificate for valuation of shares in Discounted Cash Flow Method. Since it is the initial subscription, there is no scope for valuation under any method. Kindly suggest the remedy.

Thanks in advance

rvsekar2000

rvsekar2000 (Expert)
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23 December 2011 Hello,

You can give the price valuation under cash flow method without any hesitation.

Plese note that for a new company , even , if you value shares under CFM , the share value would come at par or below par.

Projection for the future should be made in a such way that the share value does not exceed the par.

Regards

R.V.Seckar

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