How to calculate market price of equity and value preference share?



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1. whether market price of an equity share is to be taken lower of BSE & NSE?
2.Regarding Valuation of preference Share ,whether tax rate be grossed up with coupon rate?

2 Answer(s)


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1. No. you can take either price or an average.
2. Tax rate applies to the coupon payments as well.

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Preferred shares have the qualities of a stock and a bond, which makes valuation a little different than a common share. The owner of the preferred share is part owner of the company, just like a common shareholder. The stake in the company is in proportion to the held stocks. Also, there is a fixed payment which is similar to a bond issued by the company. The fixed payment is in the form of a dividend and will be the basis of the valuation method for a preferred share. These payments could come quarterly, monthly or yearly, depending on the policy stated by the company.

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