Private Company Valuation [electronic resource] : How Credit Risk Reshaped Equity Markets and Corporate Finance Valuation Tools /
Oricchio, G.author.
The recent crisis in financial markets has seen a gradual erosion of risk-free asset classes. In equity markets the credit risk has reached a critical level in valuation. Here a new cost of equity method for private companies is presented based on the pricing of junior subordinated notes. Global business cases are illustrated to support this.
Description based upon print version of record.
Cover; Half-Title; Title; Copyright; Dedication; Contents; List of Tables; List of Figures; Foreword by Sergio Ermotti; Acknowledgments; 1 Introduction; 1.1 How the financial markets are changed: where is "risk free"?; 1.2 How equity valuation methods are changing: the growing role of credit risk; 1.3 How this book is structured; 2 Private Companies' Equity Valuation Methods; 2.1 Equity value configurations; 2.2 Reliability of equity fair valuation methods; 2.3 Relative valuation and fundamentals-based valuation approaches; 2.4 Relative valuation approaches; 2.5 Earnings-based methods
2.6 Cashflow-based methods2.7 Stock-based methods; 2.8 Intangible assets valuation; 2.8.1 Human capital; 2.8.2 Commercial licences; 2.8.3 Order book; 2.8.4 Brand; 2.8.5 Customer portfolio and customer database; 2.8.6 Mineral exploration and research concessions; 2.9 Flow-stock methods; 2.10 Majority control premium and minority discount; 3 Cost of Equity for Private Companies: The Integrated Pricing Model; 3.1 Introduction; 3.2 Shareholder's expected loss; 3.2.1 The Floor Theorem; 3.2.2 The Cap Theorem; 3.2.3 The Combined Rule for the expected loss for the shareholder
3.3 Junior subordinated pricing model3.4 The relationship between the cost of equity and the credit rating: the Integrated Pricing Model (IPM); 3.4.1 CAPM for private companies; 3.4.2 Fixed income approach for private companies; 4 Integrated Pricing Model in USA; 4.1 RiskCalc USA; 4.1.1 Data description; 4.1.2 Model components; 4.1.3 Validation results; 4.1.4 Further model improvements; 4.2 Business case: Fashionbyte; 4.2.1 Introduction to Fashionbyte; 4.2.2 Business model and competitive advantage; 4.2.3 Equity valuation; 4.2.4 The new approach; 5 Integrated Pricing Model in Japan
5.1 RiskCalc Japan5.1.1 Data description; 5.1.2 Model components; 5.1.3 Validation results; 5.1.4 Further model improvements; 5.1.5 Conclusion; 5.2 Business case: Nippon Solar; 5.2.1 Introduction to Nippon Solar; 5.2.2 Business model and competitive advantages; 5.2.3 Equity valuation; 5.2.4 The new approach; 6 Integrated Pricing Model in China; 6.1 RiskCalc China; 6.1.1 Data description; 6.1.2 Model components; 6.1.3 Validation results; 6.2 Business case: Daijin; 6.2.1 Introduction to Daijin; 6.2.2 Business model and competitive advantages; 6.2.3 Equity valuation; 6.2.4 The new approach
7 Integrated Pricing Model in Russia7.1 RiskCalc Russia; 7.1.1 Unique features of the Russian market; 7.1.2 Data description; 7.1.3 Model components; 7.1.4 Validation results; 7.2 Business case: Ural Fashion; 7.2.1 Introduction to Ural Fashion; 7.2.2 Business Model and competitive advantage; 7.2.3 Equity valuation; 7.2.4 The new approach; 8 Integrated Pricing Model in India; 8.1 RiskCalc emerging markets; 8.1.1 Data description; 8.1.2 Model components; 8.1.3 Validation results; 8.1.4 Model calibration and the adjustment factor; 8.2 Business case: Rabbas; 8.2.1 Introduction to Rabbas
8.2.2 Business model and competitive advantage
Includes bibliographical references and index.
The recent crisis in financial markets has seen a gradual erosion of risk-free asset classes. In equity markets the credit risk has reached a critical level in valuation. Here a new cost of equity method for private companies is presented based on the pricing of junior subordinated notes. Global business cases are illustrated to support this.
Risk management.
Capital market.
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Bookkeeping .
Business enterprises—Finance.
Investment banking.
Securities.
Development economics.
Risk Management.
Capital Markets.
Accounting/Auditing.
Business Finance.
Investments and Securities.
Development Economics.