Your Company Is Worth ₹100 Crore: How to Test the Valuation

“Our company is worth ₹100 crore” is incomplete without a valuation date, methodology and definition of what is being valued. Promoters should resolve those questions before negotiating the percentage offered to an investor.

Generic office building, illustrating business funding and planning

Image: Side of office building by Alanthebox; CC0 1.0. Unmodified, illustrative photograph.

Identify the value being discussed

Enterprise value describes the operating business on a specified basis. Equity value reflects the amount attributable to shareholders after the agreed debt, cash and other adjustments. Pre-money and post-money describe the position before and after new capital.

An illustrative enterprise value of ₹100 crore, less ₹30 crore debt and plus ₹5 crore eligible cash, gives ₹75 crore equity value before other adjustments. A ₹25 crore primary equity subscription would then imply ₹100 crore post-money and 25% ownership for the new investor, assuming ordinary shares and no other dilution.

Test the assumptions, not just the spreadsheet

A discounted cash-flow analysis depends on future cash generation and risk. Comparable-company or transaction multiples depend on whether the comparison businesses actually share the same economics. Neither approach removes judgment.

Ask management to explain:

  • How much growth comes from signed business rather than pipeline.
  • Whether margins include the full cost of professional management.
  • How much cash must be reinvested in stock, credit and capacity.
  • Whether the business depends on one customer, supplier or promoter.
  • What changes if expansion is delayed or a major customer leaves.

Separate negotiation from statutory valuation

NDI pricing requirements can constrain an FDI transaction, but a compliant valuation does not force an investor to accept the promoter’s commercial expectations. Rights attached to preference instruments also need to be understood before comparing headline prices.

Present a range and the conditions behind it

Offer a base case and explain the evidence required to justify a higher value. Identify the downside explicitly. If a price depends on future milestones, discuss the legal and commercial feasibility of the proposed mechanism rather than assuming it can be implemented later.

The useful outcome is a clear valuation bridge: operating assumptions, enterprise value, debt and cash adjustments, new money, and fully diluted ownership. That lets both parties see exactly where they disagree and whether the difference is economic, evidential or regulatory.

Connect with Monei Matters

Discuss your valuation assumptions, funding requirement and investor presentation with Monei Matters.

Monei Matters
B-9, Near City Centre Market, Ramprastha, Ghaziabad, Uttar Pradesh 201011
Phone: +91 93138 03227 / +91 93110 03227
Website: www.moneimatters.com

Services include business finance, working capital, commercial mortgage/LAP, lease rental discounting, debt syndication, restructuring, settlements, FDI advisory and equity syndication.

Disclaimer

General information based on sources reviewed for the position as at 10 September 2026; not transaction-specific legal, tax or investment advice. Illustrations are hypothetical. Applicable law, documents and lender or investor terms govern each case; funding and settlement outcomes are not guaranteed.

Sources

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