Year of Graduation
Market Multipliers Adjustments for Evaluating the Banks in Emerging Equity Markets
Financial Markets and Financial Institutions
As most valuation methods have come to us from developed countries as a reference, the question of applicability has been devoted little attention, although in the twentieth century and appears in a number of studies of valuation methods for emerging markets. When applying standard multipliers for the companies of the developed markets to the valuation of companies in emerging capital markets, there are a number of problems associated with the characteristics of the firms latest: low level of trust in them, different reporting formats, different stages of development, market potential, and other characteristic features. Also complicate the analysis of companies in developing capital markets a limited number of transactions and the relatively small number of publicly traded companies in the financial market, which is reflected in the search of similar companies, so as such companies for comparisons you have to look for companies in the developed capital market. In this regard, the usual methods of comparative analysis require some adjustments on multiple levels. Necessary adjustments not only the multipliers for smoothing out country differences, but also the method of selection of peers. This work is dedicated to figuring out necessary for a complete analysis of the adjustments of the multipliers for banks from emerging capital markets and evaluate the effectiveness of the investigated approach.