Suggested Reading:
Covid-19 continues to extract significant healthcare and economic cost globally. Private equity investors have been impacted in many ways. Given the heightened uncertainty in the market, general partners have shifted their focus from making new investments to stabilising their portfolios. Understanding how the value of their portfolio companies have changed due to Covid-19 is a key aspect of managing the risk and return of their portfolios.
The International Valuation Standards Council’s (“IVSC”)^ Technical Boards issued a special letter in March 2020 providing guidance on conducting valuation under uncertain times, given the impact of Covid-19 on businesses and in particular on valuations.
Covid-19: Is Market Approach Valuation Relevant During Uncertain Times?
By: Adrian Cheow, Executive Director & Practice Leader, Deal Advisory, FCCA 
Hailey Looi, Senior Manager, Deal Advisory, CVA
Ellen Tjia, Lead Consultant, Deal Advisory, CA Singapore
The economic turmoil caused by the Covid-19 pandemic has revived memories of the global financial crisis (“GFC”) associated with global stock market crash, recession, central bank and government’s intervention. With the benefit of hindsight, the GFC persisted almost 2 years with global stock markets recovering in the long run.
As illustrated in the following charts (found in the article), the Wall Street’s S&P 500 and London’s FTSE 100 Index have plummeted to a low by mid-March 2020, and since then rebounded although the number of Covid-19 cases in the United States (“US”) and United Kingdom (“UK”) continues to rise. In particular, global stock markets have been trending higher in anticipation that the worst of the pandemic may be over.
Download Covid-19: Is Market Approach Valuation Relevant During Uncertain Times?
>> Back to Baker Tilly Singapore Coronavirus Resource Hub>> Main Page
DISCLAIMER: All opinions, conclusions, or recommendations in this article are reasonably held by Baker Tilly at the time of compilation but are subject to change without notice to you. Whilst every effort has been made to ensure the accuracy of the contents in this article, the information in this article is not designed to address any particular circumstance, individual or entity. Users should not act upon it without seeking professional advice relevant to the particular situation. We will not accept liability for any loss or damage suffered by any person directly or indirectly through reliance upon the information contained in this article.