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Income Approach to Business Valuation: Russian Perspective

Author

Listed:
  • Olga Almabekova Roman Kuzmich Elena Antosik

    (Siberian Federal University, Krasnoyarsk, Russia.)

Abstract

In crisis times, making the choice of a company to invest becomes challenging for a potential investor due to the uncertainty of business environment and dim future prospects. As for industries, the decision is often made in favor of the companies satisfying consumers’ basic needs. The value of a business is known to be the main indicator of the company’s reliability and investment attractiveness. The article provides substantiation of the reliability of income approach for business valuation in the time of economic crisis in Russia and presents an algorithm for implementing the cash flow discounting method within the framework of income approach using the case for a middle-sized construction company. The choice of the object for the research is due to the investment attractiveness of the construction industry in a big industrial city of Krasnoyarsk in the North East of Russia. JEL Classification: G11, G17

Suggested Citation

  • Olga Almabekova Roman Kuzmich Elena Antosik, 2018. "Income Approach to Business Valuation: Russian Perspective," Zagreb International Review of Economics and Business, Faculty of Economics and Business, University of Zagreb, vol. 21(2), pages 115-128, November.
    • Handle: RePEc:zag:zirebs:v:21:y:2018:i:2:p:115-128
    DOI: 10.2478/zireb-2018-0017
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    More about this item

    Keywords

    income approach; business value; investment;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G17 - Financial Economics - - General Financial Markets - - - Financial Forecasting and Simulation

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