IBBI Registered Valuers
Valuation of Securities Under Income Tax Act - Rule 11UA Reports
Defensible FMV reports for unquoted equity shares, CCPS, CCDs, and warrants prepared by our team of IBBI-registered valuers, led by Harsh Patel (NACVA CVA), for full compliance with Rule 11UA of the Income Tax Rules, 1962.
Why Rule 11UA Valuation Cannot Be Overlooked ?
When securities of a closely held company change hands through a funding round, share transfer, gift, or buyback, the Income Tax Act requires the transaction price to be benchmarked against fair market value (FMV).
Rule 11UA prescribes the exact method and the authorised valuer for each class of security.
Transact without a compliant valuation and the exposure is direct: the recipient faces additions to income under Section 56(2)(x),
and
The transferor faces capital gains recomputed on FMV under Section 50CA regardless of
the actual consideration received.
Securities and Instruments We Value for Rule 11UA/11UB
Equirium's expertise and authorisation under Rule 11UA is specific to securities and financial asset classes. We prepare compliant FMV reports for:
Unquoted equity shares - of closely held private limited and unlisted public companies
Compulsorily Convertible Preference Shares (CCPS) - across all stages, from seed to pre-IPO
Compulsorily Convertible Debentures (CCDs) - including hybrid structures with equity-linked returns
Warrants - issued to investors as part of structured funding arrangements
Other specified financial instruments - as notified under the amended Rule 11UA
When You Need Report Under Rule 11UA ?
Transactions Covered Under Section 56(2)(x)
Section 56(2)(x) taxes the recipient when securities are received for a consideration below FMV. A Rule 11UA valuation is required to establish that FMV at the time of:
- Angel and seed funding rounds - shares or CCPS issued to investors
- Gift of shares or securities between related or unrelated parties
- Private placements and preferential allotments to specified investors
Transactions Covered Under Section 50CA
Section 50CA taxes the transferor - computing capital gains on FMV rather than actual sale price when unquoted shares are transferred below FMV. A pre-transaction FMV report is the transferor's only independent basis to defend the transaction price.
| Methodology | Value |
|---|---|
| DCF Method | XX.XX |
| Comparable Co. | XX.XX |
| Weighted Avg. | XX.XX |
What our valuation report under Income Tax Act contains ?
Our reports are written to stand up to scrutiny from regulators, auditors, and incoming investors. Each engagement delivers:
- Fair value per security, with the basis of value clearly stated.
- Method selection and rationale, why the chosen approach fits your security type and stage.
- Key assumptions and inputs, documented transparently so the number can be followed and defended.
- Sensitivity to core drivers, where the security type and data allow..
- A signed registered-valuer report, formatted for your Section 42 record and investor data room.
Why choose Equirium Analytics ?
For India regulatory valuations, your report is prepared by our team of IBBI-registered valuers, led by Harsh Patel (NACVA Certified Valuation Analyst). What that means for you:
Independence.
We are not your investor or your counterparty. The valuation is unbiased, which is exactly what makes it defensible.
Technical depth.
Five years of valuation engagements across Indian regulatory work, applied to the specific demands of a Rule 11UA/UB.
Confidentiality first.
We work NDA-first;
your financials, cap table,
and deal terms
stay protected.
Clear turnaround.
A clearly defined timeline is agreed upon from the outset, ensuring your share allotment process stays on track.
Our process for delivering the Private Placement Valuation Reports
Frequently Asked Questions
Need A Guidence ?
- IBBI-registered team.
- Independent and NDA-first.
- Transaction-ready delivery.
- Specialists in securities valuation.