#shareholder equity

[superpruchika99world]

Why is India Inc seeing a surge in shareholder activism?

Companies News For some time now, experts have held that the phenomenon of shareholder activism is in a nascent stage in India. But there can still be no doubt that cases of shareholder activism are on the rise in the country.

Meanwhile, proxy advisory firms continue to raise red flags when they feel that something is amiss. This year itself, there have been a number of instances where shareholders have challenged promoters and management.

ALSO READ: Allegro Capital named in Pandora Papers: What was the Sebi order about?

Let's examine how this rising tide has impacted India Inc. Towards the end of September this year, Pune-based Kinetic Engineering Ltd's shareholders rejected the company's proposal to increase Managing Director Ajinkya A Firodia's remuneration.

Earlier, in September, Ekta Kapoor and Sobha Kapoor, who are part of Balaji Telefilms' promoter group, faced shareholder ire and failed to obtain the...Read more.

[howtocalculate]

How to Calculate Book Value of a Company

BOOK VALUE of any company represents the actual value of the company on its book (i.e account book). This can also be understood in other way that it is the value of each share of a company,  after all its assets are sold for cash and  all the liabilities are paid off. To understand it better lets first understand the Shareholder’s Equity.

SHAREHOLDER EQUITY: it is the retained earnings from the prior (last) year + net income of the year at hand (revenues expenses) – dividend paid during the year at bond +share capital. It is also defined as,

Shareholder’s Equity= Total assets – Total Liability

Now book value of a company is defined as Shareholder’s Equity divided by the Nos of Outstanding shares.

    Book Value Formula,

We find or calculate Book value of a company to actually compare it by its share value i.e CMP (Current Market Price). So that we can judge whether we are able to buy the business for less than what its assets are worth (after deducting liabilities). This is also expressed as the ratio of Price to Book. A P/B ratio of less than 1 is always better.

  Also read,

What is Price to Earning Ratio (PE) ??

What is Earning Per Share (EPS) ??

How to Calculate Book Value of a Company was originally published on How to Calculate