How to Value a Company in Singapore: Methods, Costs and When You Need a Report

TLDR:

• A company valuation estimates what a business or its shares are worth on a specific date, for a specific purpose.
• Valuers use three approaches: income (discounted cash flow), market (comparable multiples) and asset (adjusted net asset value).
• IRAS charges stamp duty on private share transfers at 0.2% of the higher of the price paid and the shares' net asset value.^[1]
• Singapore SME valuations commonly cost about S$3,000 to S$15,000+ and take around 2 to 4 weeks.
• Business valuation in Singapore has its own professional body, the Institute of Valuers and Appraisers, Singapore (IVAS), set up under ACRA.^[3]

Company valuation in Singapore is the process of estimating the economic value of a private company or its shares, using recognised methods, as at a defined date and for a defined purpose. Owners usually need a valuation when shares change hands, when investors come in, when a shareholder exits, or when the business is being sold. The purpose matters because it decides the standard of value, the method and the type of report a buyer, investor, auditor or IRAS will accept.

What is a company valuation?

A company valuation is a reasoned estimate of what a business or its shares are worth, supported by financial analysis and stated assumptions.

A valuation is not a single "correct" number. It is a value or range that a willing buyer and a willing seller would reasonably agree on, given the information available at the valuation date. A good valuation report explains the method used, the key assumptions and how sensitive the result is to changes in those assumptions.

People use "company valuation" and "business valuation" interchangeably. Strictly, enterprise value is the value of the whole operating business, while equity value is what is left for shareholders after deducting debt and adding surplus cash. A share valuation for a transfer or buyout focuses on equity value per share.

When do you need a company valuation in Singapore?

Singapore companies most often need a valuation when ownership changes or when an outside party must rely on the value.

ACRA does not require a valuation report simply to record a share transfer. In practice, though, any transaction between parties who might later disagree benefits from an independent, documented value.

What are the main company valuation methods?

Valuers use three approaches (income, market and asset) and usually cross-check at least two of them.

These approaches are recognised internationally in the International Valuation Standards (IVS) issued by the International Valuation Standards Council.^[5]

How does the discounted cash flow (DCF) method work?

A DCF valuation projects the company's free cash flows, usually over five years, then adds a terminal value for the years beyond. Each year's cash flow is discounted back to the valuation date using a discount rate that reflects the risk of the business. For an equity value, the valuer then subtracts debt and adds surplus cash. Small private companies normally attract a higher discount rate than large listed companies because of size, concentration and key-person risk.

How do valuation multiples work?

The market approach applies a multiple observed in comparable companies or deals to the subject company's own figures. For example, if similar businesses changed hands at around six times EBITDA, a company with S$500,000 of sustainable EBITDA would indicate an enterprise value of around S$3 million before adjustments. Multiples from listed companies are usually adjusted downwards for a private company, because private shares are harder to sell and the business is typically smaller.

When is net asset value the right basis?

Net asset value suits companies whose value sits mainly in what they own rather than what they earn, such as property holding companies, investment holding companies and businesses being wound down. It is also the basis IRAS uses to value private company shares for stamp duty, which makes it relevant to almost every share transfer.

How does IRAS value shares for stamp duty on a share transfer?

IRAS charges stamp duty at 0.2% of the higher of the purchase price and the net asset value (NAV) of the private company shares transferred.^[1]

For shares in private companies, IRAS takes the value of the shares transferred to be their net asset value or the allotment price. The NAV is computed from the target company's latest statement of accounts, which should be dated within 24 months before the date of transfer. If the company owns property, including leasehold property recorded as a non-current asset, the property's market value at the date of the transfer document replaces its book value. The accounts must then be certified by a director or the company secretary.^[1] Stamp duty is rounded down to the nearest dollar, subject to a minimum of S$1.^[2]

Worked example: stamp duty on a share transfer

This is an illustrative example. The point is that a below-NAV price does not reduce stamp duty, and a company with valuable property on its books can face a much higher NAV than its accounts suggest.

How do you value a company step by step?

A structured company valuation moves from purpose to data, then to analysis and a reconciled conclusion.

1. Define the purpose and valuation date. A transfer between family members, a funding round and a court dispute each call for different standards of value and levels of report.
2. Collect financial information. Gather two to three years of financial statements, current management accounts, forecasts, the cap table, loans, leases and key contracts.
3. Normalise earnings. Adjust for one-off items, owner salaries above or below market rate, related-party transactions and non-operating assets.
4. Apply at least two approaches. Build a DCF where forecasts are credible, select comparable multiples, and compute an adjusted NAV.
5. Reconcile and test sensitivity. Weigh the approaches, explain any gaps, and show how the value moves with growth, margin and discount rate.
6. Move from enterprise value to equity value. Deduct debt and debt-like items, add surplus cash and consider adjustments for minority stakes or restricted marketability.
7. Document the conclusion. Issue a report stating the value or range, methods, assumptions, information relied on and limitations.

How much does a company valuation cost in Singapore and how long does it take?

A Singapore SME valuation commonly costs from about S$3,000 to S$15,000 or more and takes roughly 2 to 4 weeks once information is complete.

Fee ranges are indicative figures based on fees published by Singapore providers. The main cost drivers are the purpose of the report, the number of entities, the quality of the financial records and whether the report must withstand scrutiny from a court or opposing expert. Most firms quote a fixed fee after a scoping call.

Who can prepare a business valuation in Singapore?

Singapore does not license business valuers in general, but it has a recognised professional designation: the Chartered Valuer and Appraiser (CVA).

The Institute of Valuers and Appraisers, Singapore (IVAS) was set up under the Accounting and Corporate Regulatory Authority (ACRA) to develop the business valuation profession.^[3] IVAS runs the CVA programme, which is aligned with the International Valuation Standards. CVA holders must complete the programme and have relevant valuation experience.^[4]

For many private purposes, such as a share transfer between existing shareholders or internal planning, a well-documented valuation from a qualified adviser is sufficient. Where a bank, court, auditor or listing process will rely on the report, check that party's requirements before you appoint a valuer. Some recipients expect a report signed by an independent accredited valuer.

What drives the value of a Singapore SME?

Sustainable cash flow, growth and risk drive value far more than revenue alone.

• Quality of earnings: recurring, contracted revenue is worth more than one-off project income.
• Customer concentration: heavy reliance on one or two customers lowers value.
• Owner dependence: a business that runs without its founder is easier to sell and to finance.
• Clean records: up-to-date accounts, filings and statutory registers reduce buyer risk and due diligence cost.
• Growth and margins: credible forecasts backed by history support higher multiples.
• Assets and debt: property, cash and borrowings move the equity value directly.

Common company valuation mistakes

Most valuation disputes come from using the wrong basis for the purpose rather than from arithmetic errors.

• Applying a rule-of-thumb multiple without checking it against comparable data.
• Using listed-company multiples for a small private company without adjustment.
• Forgetting to deduct debt when moving from enterprise value to equity value.
• Pricing a share transfer below NAV and assuming stamp duty follows the lower price.
• Ignoring property held at old book values when computing NAV.
• Relying on outdated accounts, more than 24 months old for stamp duty purposes.
• Not documenting assumptions, which leaves the value hard to defend later.

How can E&H Corporate Services help with a company valuation?

E&H Corporate Services prepares company valuations for Singapore SMEs and start-ups and handles the corporate steps that follow.

We start with a scoping call to confirm the purpose, valuation date and who will rely on the report, and then quote a fixed fee. Because we also provide accounting, tax and corporate secretarial services, we can carry the result straight into the share transfer, stamp duty computation, board and shareholder resolutions and ACRA filings. See our company valuation services in Singapore.

Need to know what your company is worth? Talk to E&H about a company valuation for a share transfer, fundraise, shareholder exit or sale.

Frequently Asked Questions

How much does a business valuation cost in Singapore?

Fees depend mainly on purpose and complexity. Market fees commonly range from around S$3,000 for a simple desktop valuation of a small SME, to S$5,000–S$10,000 for a standard SME report, and S$15,000 or more for complex, multi-entity or dispute-ready work.

Is a business worth three times its profit?

Not necessarily. A profit multiple is only a shortcut. The right multiple depends on growth, risk, how much the business depends on its owner, the quality of earnings and what comparable companies sold for. Two companies with the same profit can be worth very different amounts.

Can I value my own company?

You can estimate a value yourself for internal planning. When a value will be relied on by an investor, buyer, co-shareholder, auditor, court or tax authority, an independent valuation is far more persuasive and is sometimes required.

How does IRAS value private company shares for stamp duty?

IRAS charges stamp duty at 0.2% of the higher of the purchase price and the value of the shares. For private companies the value is the net asset value, computed from accounts dated within 24 months before the transfer. If the company owns property, the market value of the property replaces its book value.^[1]

How do you value a start-up with no profit?

Start-ups without stable profits are usually valued on recent funding rounds, revenue or user-based multiples from comparable companies, venture capital method calculations, and scenario-weighted cash flow forecasts. The terms of the latest round, such as liquidation preferences, also affect what each share class is worth.

How often should a company be valued?

There is no legal requirement for a private Singapore company to be valued regularly. Companies typically commission a valuation at trigger events such as a share transfer, a funding round, an employee share option grant, a shareholder exit, a sale or a restructuring.

Related reading

• Company Valuation Services in Singapore
• Shareholders' Agreement in Singapore: Essential Clauses for Founders
• Ordinary vs Preference Shares in Singapore
• Dividends in Singapore: Company Tax and Payment Guide
• What is the process for a share transfer and is stamp duty payable?

Sources & References

1. Buying or acquiring shares: stamp duty — Inland Revenue Authority of Singapore
2. Stamp duty rates — Inland Revenue Authority of Singapore
3. Institute of Valuers and Appraisers, Singapore (IVAS) — Accounting and Corporate Regulatory Authority
4. Chartered Valuer & Appraiser (CVA) designation — Accounting and Corporate Regulatory Authority
5. International Valuation Standards — International Valuation Standards Council