Cabinet to consider 5 methods for strategic sale valuation

The finance ministry is likely to propose to the Cabinet at least five different methods, including relative peer review and discounted cash flow, for valuation of over a dozen public sector units (PSUs) across sectors identified for strategic stake sale. With the privatisation of PSUs being considered after a gap of over 12 years, the ministry feels the valuation of equity becomes important in the case of strategic sale of companies that are not listed or in cases where capital markets may not fully reflect the intrinsic worth of a share disinvested earlier.