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Estimation of capital structure for the purposes of market valuation of a company in the conditions of the Czech Republic - Part 2
[Odhad kapitálové struktury pro účely tržního oceňování podniku v podmínkách ČR - 2. část]

Author

Listed:
  • Pavla Maříková
  • Andrej Tóth

Abstract

The aim of the article is based on data from the Amadeus database to find out to what extent it is appropriate to take over the average indebtedness of companies on foreign capital markets for the valuation of companies operating in the Czech Republic, which are in most cases non-traded companies. The second part of the article focused on three sectors: manufacture of machinery, manufacture of pharmaceutical products and construction. The capital structure of companies in the Czech Republic, Poland, Germany, France and the United Kingdom was examined.The analysis shows that in European countries, non-traded companies are significantly less indebted than traded companies. Taking over the indebtedness of foreign traded companies for the valuation of non-traded Czech companies is thus completely inappropriate. When valuing traded companies, it is possible to take foreign data into account, but only with caution, because the amount of indebtedness varies considerably in different European countries and even within one country there is a large variance of debt values between individual companies.

Suggested Citation

  • Pavla Maříková & Andrej Tóth, 2021. "Estimation of capital structure for the purposes of market valuation of a company in the conditions of the Czech Republic - Part 2 [Odhad kapitálové struktury pro účely tržního oceňování podniku v ," Oceňování, Prague University of Economics and Business, vol. 14(3), pages 37-69.
    • Handle: RePEc:prg:jnloce:v:14:y:2021:i:3:id:2021_3_03:p:37-69
    DOI: 10.18267/j.ocenovani.265
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    More about this item

    Keywords

    market value; business valuation; capital cost; capital structure; discount rate; tržní hodnota; ocenění podniku; náklady kapitálu; kapitálová struktura; diskontní míra;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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