Valuation Services
Registered Valuers in India: What They Do, Who Needs One and How to Find One
Lekha Editorial Team
CA-reviewed · Published
Registered Valuers (RVs) are a relatively new profession in India, created by the Companies (Registered Valuers and Valuation) Rules, 2017. Their existence is often unknown to founders and business owners until the specific transaction that legally requires one. At that point, discovering you need an RV and that the lead time for their engagement is 2–4 weeks creates unnecessary pressure.
When a Registered Valuer Is Legally Mandatory
The Companies Act, 2013 and its associated rules require Registered Valuer involvement in specific transactions:
Section 62(1)(c) — Further issue of shares: when a company issues new shares to specific persons other than through a rights issue or ESOPs (preferential allotment), the price must be justified by an RV valuation.
Section 230/232 — Mergers and amalgamations: valuations required for the scheme of arrangement must be by an RV.
Section 236 — Buy-out of minority shareholders: the fair price must be determined by an RV.
Section 247 — General valuation of property, stocks, shares, debentures, or business: wherever the Companies Act or rules require valuation, it must be by an RV registered in the relevant asset class.
Under the Insolvency and Bankruptcy Code (IBC): valuations during the CIRP (Corporate Insolvency Resolution Process) must be conducted by RVs. Two independent valuations by different RVs are required for liquidation value and fair value.
Note: Rule 11UA (income tax, ESOP exercise pricing) does NOT require an RV — it requires a merchant banker. These are different qualifications.
Asset Classes of Registered Valuers
IBBI registers valuers in three specific asset classes:
Securities and Financial Assets (SFA): valuers registered in this class value equity shares, debt instruments, convertible instruments, and other financial assets. This is the most relevant class for startup-related valuations (M&A, preferential allotments, buy-outs).
Land and Building (L&B): valuers registered here assess real estate — commercial, residential, and agricultural property.
Plant and Machinery (P&M): valuers registered here assess machinery, equipment, and tangible fixed assets.
For startup transactions (share valuations under Companies Act provisions), you need an SFA-class Registered Valuer. For manufacturing company acquisitions involving both business and machinery, you may need RVs from both the SFA and P&M classes.
Eligibility for RV registration: the individual must be a member of a Registered Valuer Organisation (like ICAI, ICSI, ICWAI, or RICS for specific asset classes), have relevant qualification and 3–5 years of experience in the relevant field, pass the IBBI valuation examination, and apply for registration with IBBI.
Registered Valuer vs Merchant Banker: Which Do You Need?
This distinction is the single most common source of confusion in Indian corporate transactions:
Merchant Banker (SEBI-registered): Required for income tax purposes (Rule 11UA, ESOP exercise pricing, Section 56(2)(viib) compliance). The SEBI MB registration is the qualifying credential.
Registered Valuer (IBBI-registered): Required for Companies Act purposes (Section 62(1)(c), 230, 232, 236, 247) and IBC purposes. The IBBI RV registration is the qualifying credential.
A person can theoretically hold both registrations (some do), but the registrations are separate — a merchant banker certificate does not substitute for an RV report for Companies Act purposes, and an RV report does not substitute for a merchant banker certificate for Rule 11UA purposes.
For a typical funding round: you need both. The investor's preference shares are issued under Companies Act Section 62(1)(c) (requiring RV for certain structures) and the income tax compliance requires Rule 11UA (requiring MB). Lekha connects you to the right professional for each requirement.
Key takeaway
Know which type of valuer you need before engaging one — an RV certificate for a tax purpose, or a merchant banker certificate for a Companies Act purpose, gets you an unusable document. Engage early, provide complete information, and verify the professional's specific registration type.
Frequently asked questions
How long does a Registered Valuer take to complete a valuation report?
For a standard Companies Act valuation (preferential allotment or merger scheme), an RV typically takes 1–3 weeks from receiving all required information. Complex valuations (multiple subsidiaries, intangible-heavy businesses, disputed assets) take 3–6 weeks. For IBC CIRP valuations, the timeline is driven by the NCLT-ordered schedule — typically 30–45 days. Always engage the RV as early in the transaction timeline as possible; the valuation is frequently on the critical path.
What information does a Registered Valuer need for a business valuation?
Standard information request: audited financials for 3–5 years, management accounts for the current year, business plan and financial projections for 3–5 years, details of all assets (property, plant, equipment, IP), list of all liabilities, major contracts (customer, supplier, lease), information on key management and any change-of-control provisions, regulatory licences and permits, and any pending litigation. The completeness of information directly affects both the timeline and the quality of the valuation.
Can a Registered Valuer work in multiple asset classes?
Yes, if they have passed the IBBI examination and have the required qualifications for each class. Some valuers are registered in both Securities and Financial Assets (SFA) and Land & Building (L&B), which is relevant for companies with significant property portfolios. However, most RVs specialise in one asset class. For a startup transaction involving only equity shares, you only need an SFA-class RV. For a manufacturing company acquisition, you may need separate RVs for the business (SFA) and the machinery (P&M).
Is there a list of registered IBBI valuers I can check?
Yes. The IBBI (Insolvency and Bankruptcy Board of India) maintains a public list of registered valuers on its website (ibbi.gov.in). The list is searchable by asset class, name, and location. However, the list includes all registered valuers regardless of specialisation or experience level. For specific transaction types, it's advisable to engage through a referral from your CA, investment banker, or legal counsel who has worked with valuers on similar transactions before.
What is the difference between an RV report for IBC and for Companies Act?
The IBC valuation requires two independent valuations by different RVs — one for fair value and one for liquidation value. The IBC regulations specify the format and content of the valuation report. Companies Act valuations have fewer format requirements but must follow the valuation standards issued by ICAI (for SFA class). IBC valuations are conducted under significant time pressure (CIRP timelines), while Companies Act valuations are typically conducted with a less compressed timeline.