Make a career out of valuation

The demand for valuation experts is on the rise. As India Inc. goes global—by accessing capital or making acquisitions abroad—companies are seeking authentic valuations for their businesses.

Explains Varun Gupta, Managing Director, American Appraisal India, a global valuation services firm: “Mergers and acquisitions (M&A) activity, which is growing at 30-35 per cent annually, is driving the demand as is the trend of Indian companies raising capital from global markets. They will have to restate their balance sheets in accordance with international accounting standards and this requires a fair valuation.”

Valuation has multiple facets—valuations of business enterprises, financial assets, intangible assets, real estate and machinery & equipment. Market analysts point out that the purpose of valuation has evolved over the last few years. Today, valuations take place for investment decisions, litigation, tax and strategic planning initiatives, mergers and acquisitions, restructuring, employee stock ownership plans and incentive stock options.

Says S. Sethuraman, CFO, TMI Group, a Hyderabad-based talent acquisition firm: “The complexity of valuations and sophistication of businesses have forced the valuation professional to seek specialised training and knowledge in order to keep up with the changing times.”

However, Gupta believes that the demand for valuation professionals will see a major jump once Indian companies adopt International Financial Reporting Standards (IFRS).

“The implementation of IFRS is expected to happen by 2011 and this will open up tremendous opportunities for such fair valuation work. It is an area most corporate houses need to start addressing very proactively. As a result, it is expected that industry will require over 2,500 such professionals in the next three years.”

—Manu Kaushik

Fact box Who’s hiring: PricewaterhouseCoopers, KPMG, Deloitte, Ernst & Young, American Appraisal India and Grant Thornton, among others. Who’re they hiring: Chartered Accountants and MBAs with specialisation in Finance. At what levels: At all levels—Consultant, Associate Consultant (two or more years of work experience), Senior Consultant (five or more years of work experience), Assistant Vice President (over eight years of work experience), Vice President (over 12 years of work experience) and Partner (above 15 years of work experience). At what salaries: Consultants start with salaries of between Rs 6 lakh and Rs 10 lakh per annum. Senior Consultants can command anywhere around Rs 15-20 lakh p.a., Assistant Vice Presidents get around Rs 25-30 lakh p.a., while a Vice President can earn upwards of Rs 40 lakh a year. Partners can get a salary of above Rs 60 lakh annually, including both fixed and variable components. What are the numbers like: There are around 300 valuation professionals currently employed across big consultancies. This is expected to touch 2,500-3,000 by 2011.