Posts Tagged ‘company bad practices’

SharesVault Advisory Service – Advice to companies looking for Public Market

Tuesday, October 2nd, 2012

SharesVault team is meeting with many companies for getting them registered on SharesVault. Many of them are ready to come on SharesVault. No one said clear no for registration as almost every companies are looking for fund now a days – be it working capital or new project finance.

Than why SharesVault doesn’t allow them all to come on board ? Companies might have 100+ Crore turnover but does that make it qualify for SharesVault registration? Answer is No. Turnover is not as important for SharesVault as it is for company. Reason is number only doesn’t justify potential, credibility, reputation and growth of a company. Majority of companies SharesVault met doesn’t pass through SharesVault due diligence process because of hiding some financial numbers in saving taxes.

In saving taxes and bad accounting practices, companies are loosing it’s value which could be multiple of 3 – 4 or more depends on company’s growth, profit, PE multiple and EPS. Reason for such thing would be less awareness for company’s valuation. Family run businesses which are going to last forever and don’t want any exposure like public market or outside investors have such mentality of not disclosing profits.

From the company’s point of view – recession, inflation, government expenditure for company’s industry, government policies, corruption etc are crucial parameters which forces company for bad practices.

SharesVault has started advising companies in their growth stage/early stage or even when companies are partnership/proprietor firm. Good accounting practices will bring good investors for companies and also bring good growth.
It’s not all about accounting practices only, there are other parameters like – share holding pattern, CA and CS consultation, Board of Directors, advisers.

SharesVault provides advisory services for companies to be ready for public market. This takes time but in long run company’s value will be increased like anything. Like company having 100 Crore turnover has current share price of Rs.50 which is too less for such company can go up to Rs.200 or more if good accounting practice and corporate governance is followed.

SharesVault make company follow good practices for the betterment of company and indirectly investors.