what s the need of valuation, why shall we valuate our company? what s the benefit of valuating a company?



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i just completed Part3 of the course( share and valuation) , for summarizing, what s the need of valuation, why shall we valuate a company and what s the benefit? and how many kind of valuation we have, and which the most used? jus to better understand this part

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Valuation is used to fundamentally understand how much a company is worth. For example if you want to buy a house or a car you first need to know how much to pay for that. Similarly when you want to buy a companies shares you want to understand how much the company is worth. Its the same idea.

There are 3 popular valuation methods - DCF, Comparable Trading and Comparable Acquisitions. Usually all 3 are used to understand the rough valuation of a company.

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