What is the meaning of Market Value Addition?


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Market Value Addition

 

 

 MVA [Market Value Addition]

  • The market value is the difference between the current market value of the firm and the capital employed by the firm.
  • MVA is simply the present value of all future.

*Formulas-

  • MVA= Market Value of capital employed- book value of capital employed
  • MVA= Market Value of equity shares capital- book value of equity shareholders fund
  • MVA= Market Capitalization – book value of owned fund

Market capitalization= MPS x Nos of equity shares

MPS= P/E Ratio x EPS

 


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