I have a question regarding the recoding of Associate A/C & Joint Venture A/C in the balance sheet.
Please refer to the following example:-
Quoted equity shares at cost 111,700
Share of post acquisition reserves 85,500
Share of changes recognized directly in associates’ equity (39,000)
May I know what is share of post acquisition reserves? Will this amount change every year?
And also what is share of changes recognized directly in associates’ equity?
Another question is on the Price to Sales Ratio.
This valuation method is used for cyclical industry.
In your Video, you cited Wilmar as an example. As compared to their peers, it’s price to sales is only 0.35x. It’s is the lowest among the peers. But what about the intrinsic value of the companies, what valuation method should I apply on those cyclical companies, like shipping industry or commodity company as the companies can be very profitable in their good times period and very bad in their down times. So how to determine the intrinsic value of cyclical companies like Wilmar and YZJ?
P/S are used when the company is making losses. You can determine what is their average PS in the past and used it calculate the IV.
So sorry I don’t quite understand. Could you give an example to use price to sales ratio to find the intrinsic value.
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