"Enterprise Value is the overall value of any business which represents all stakeholders and often looked at while acquiring/ selling any business or making any strategic decision and is dependent on the Value of the company, its subsidiaries and the Value of surplus assets. All the above issues are relevant for working out EV."
Enterprise Value is the present value of the claims of all stake-holders against an Enterprise where an Enterprise is financed with debt and equity. If the company has no non-operating assets, firm value can be valued by estimating future free cash flows and discounting those cash flows with an appropriate rate of return (which may vary from year to year) that embodies the returns required by creditors and shareholders of the firm.
- Should only Cash or Excess Cash be deducted?
- Should only Cash be deducted or even Cash and Cash equivalents?
- Should Debt be taken at Market Value?
- Treatment of Debt if taken at year end or for setting up a new Business?
- Treatment of Loans & Advances given to subsidiary Company?
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