A valuation report is a signed opinion of the fair value of shares or a business. You need one for FEMA pricing when a non-resident invests, for the income-tax fair value of unquoted shares under Rule 11UA, for Companies Act allotments, for ESOP exercises and for M&A. Each law has its own method and signatory rules.
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Valuation Report
Startups, M&A, ESOPs, FEMA filings, IT scrutiny
Timeline
Timeline confirmed at scoping
A valuation can fall under five laws. FEMA pricing applies when a non-resident subscribes to or buys unlisted shares, certified by a CA, a SEBI-registered merchant banker or a practising cost accountant. Rule 11UA sets the income-tax fair market value of unquoted shares for sections 50CA and 56(2)(x). The Companies Act needs a registered valuer for preferential allotments and non-cash consideration. ESOP perquisite value for unlisted shares needs a SEBI-registered merchant banker. M&A reports follow the parties' agreement. The signatory and method change with the law, even for the same business.
Reviewed by CA Ganpat Khemka · Last updated 21 September 2026
Angel tax no longer applies. Section 56(2)(viib) of the Income-tax Act, 1961 was abolished by the Finance (No.2) Act 2024 for all investors, with effect from Assessment Year 2025-26, so share issues from FY 2024-25 onwards are outside it. The Income-tax Act, 2025 has no such provision.
What did not change is every other price test on shares:
For a detailed guide to each test, see Rule 11UA and FEMA share valuation. If a notice has arrived for a round up to FY 2023-24, see angel tax for earlier years.
The signatory is set by the law, not by preference. A report signed by the wrong person can be rejected even if the number is right.
| Purpose | Law | Who can sign |
|---|---|---|
| Issue or transfer of unlisted shares involving a non-resident | FEMA (Non-debt Instruments) Rules, 2019; RBI Master Direction | Chartered Accountant, SEBI-registered merchant banker or practising cost accountant |
| Transfer or receipt of unquoted shares below fair value | Income-tax Act, 1961, s.50CA and s.56(2)(x), with Rule 11UA (FY 2025-26) | Formula working, computed and certified by a CA |
| Preferential allotment, non-cash consideration | Companies Act, 2013, s.62(1)(c) and Rule 13; s.247 | Registered valuer (securities or financial assets) |
| ESOP exercise, unlisted company | Rule 3(8)(iii), for FY 2025-26 | SEBI-registered merchant banker |
| M&A, investor negotiation, internal use | Contract between the parties | As agreed |
After a foreign investment, the company reports the allotment in Form FC-GPR within 30 days. Share transfers are documented through our share transfer service.
Planning an ESOP scheme? See ESOP scheme drafting. Need more authorised capital before an allotment? Increase share capital.
Our professional fee for a valuation report is from ₹9,999. There is no government fee.
| Fee | Amount |
|---|---|
| Regikart professional fee, valuation report | From ₹9,999 per report |
| Government fee | No government fee |
Professional fees exclude GST at 18%. Government fees, where they apply, are paid at actuals to the department and are shown separately. Fees verified on 21 September 2026.
The final fee depends on the law, the method and the size of the business. Where the law needs a registered valuer or a merchant banker to sign, their fee is separate. We confirm the scope, signatory and fee in writing before work starts.
Rule 11UA
Income-tax rule that sets the fair market value of unquoted shares for sections 50CA and 56(2)(x), using an adjusted net asset formula.
Registered Valuer
Valuer registered with IBBI under section 247 of the Companies Act; only registered valuers can issue Companies Act valuations since 1 February 2019.
Merchant banker
SEBI-registered merchant banker. One of three permitted signatories for FEMA valuations of unlisted shares, with CAs and practising cost accountants; the required signatory for ESOP perquisite value of unlisted shares.
DCF / NAV / CCM
Discounted Cash Flow / Net Asset Value / Comparable Companies' Multiples - the three core methods.
Used when unquoted shares are transferred or received below fair market value, to check tax under sections 50CA and 56(2)(x).
Used for foreign investment, ODI, FDI - to ensure the price is fair under FEMA rules.
Required for preferential allotments by unlisted companies, non-cash consideration and other valuations the Companies Act requires.
FMV at exercise to compute the taxable perquisite for ESOP holders.
01
Regime confirmed (IT / FEMA / Companies / ESOP), method chosen, signatory engaged.
02
Audited financials, business plan, peer set, debt schedule, working capital - collected and validated.
03
DCF / NAV / CCM built; sensitivity tables, control / minority discount, illiquidity premium added.
04
Signed report with annexures, executive summary and methodology note - ready to file with the relevant authority.
Upload via our secure portal. We pre-check every scan before filing - cuts portal rejections by ~90%.
Still unsure if Valuation Report is right for your case? Talk to our team and we will walk you through your specifics.
Our team will get on a call with you, confirm scope and start the work.
