Asset Valuation as a Full-Time Career Opportunity
By Harihar S, Chartered Engineer & IBBI Registered Valuer
What Valuation Is, and Why It's Needed
Valuation is the process of determining the present value (PV) of an asset. Valuations can be done on assets, for example investments in marketable securities such as stocks and options, business enterprises, fixed assets, or intangible assets such as patents and trademarks, or on liabilities such as bonds issued by a company. Valuations are needed for many reasons: investment analysis, capital budgeting, merger and acquisition transactions, financial reporting, secured lending and collateral security, taxable events to determine the proper tax liability, and litigation, among others.
Valuation as a Standalone Profession
Valuation of any asset, business enterprise or shares has been in existence for a long time, and has primarily been used in scenarios including:
- Valuation for banks & financial institutions
- Valuation for impairment of assets
- Valuation for insurance purposes
- Internal audit valuation
- Valuation for visa purposes
- Self-assessment valuation
- Customs pre-shipment inspection & estimation of value
- Valuation for asset reconstruction companies
- Valuation for duty drawback
- Valuation for mergers, acquisitions, demergers
- Valuation for liquidation or auctions
- Valuation for updating book records
Asset Classes in Valuation
Land & Building
Plant & Machinery
Financial Assets
Securities and other financial instruments.
Overall Business Valuation
A combination of all three asset classes, valued together.
From Domain Sideline to Full-Time Career
Valuation of assets has mostly been carried out by domain-specific valuers experienced with the type of asset being valued: a civil engineer values land & building assets, a chartered accountant values financial assets, a mechanical engineer values machinery, and so on. In most cases, valuation has been a part-time profession where the valuer has other business interests in their domain of expertise, for example a construction company or structural consultant who also works as a land & building valuer, or an auditor who also values financial assets, or a mechanical engineering consultant who also values machinery.
Only recently have we seen the emergence of valuers pursuing valuation as a full-time scope of work. As the economy grows, the requirement for valuers and valuation has increased multifold, opening up the possibility of a full-time valuation profession or career with good remuneration over time. Valuation has become a significant professional service, recognised by the Government of India much like Chartered Accountancy or other professional services.
Opportunities in a Full-Time Valuation Profession
As the need for valuation across various purposes increases, so does the demand for valuers, and many new entrants are joining the profession, including people leaving other full-time careers to explore opportunities as a full-time valuer.
Just like any other professional service, valuation is a field where considerable experience is needed to understand its nuances, and gaining experience makes it easier to stand out amid the competition. Associates or junior valuers who join under practising valuers tend to find it easier to work through the field and eventually establish themselves as independent valuers over time. Those who venture directly into the field without fully understanding its challenges and various aspects often find it harder to know where to start, how to proceed, and how to sustain the initial years while they establish themselves as a credible, experienced valuation professional with recurring clients.
Registrations Needed for the Valuation Profession
- Registration with the Income Tax Department, under Section 34AB of the Wealth Tax Act, 1957
- Registration with the IBBI (Insolvency & Bankruptcy Board of India), under Section 247 of the Companies Act, 2013
Eligibility for Registration as a Valuer
| Asset class | Eligibility / qualifications | Experience in discipline |
|---|---|---|
| Plant & Machinery | Graduate in Mechanical, Electrical, Electronic & Communication, Electronic & Instrumentation, Production, Chemical, Textiles, Leather, Metallurgy, or Aeronautical Engineering, or Graduate in Valuation of Plant & Machinery or equivalent; or Post Graduate in the above courses | Five years / three years |
| Land & Building | Graduate in Civil Engineering, Architecture, or Town Planning or equivalent; or Post Graduate in the above courses, including in Valuation of Land & Building or Real Estate Valuation (a two-year full-time post-graduate course) | Five years / three years |
| Securities or Financial Assets | Member of the Institute of Chartered Accountants of India, Institute of Company Secretaries of India, or Institute of Cost Accountants of India; MBA or Post Graduate Diploma in Business Management (finance specialisation); or Post Graduate in Finance | Three years |
Where This Fits Into Axium's Services
For a step-by-step walkthrough of registration, see our guide on how to become an IBBI Registered Valuer, and our roundup of opportunities as an IBBI Registered Valuer once registered.
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