Comparative analysis of the valuation methods used in the public offerings in Turkey

Company valuation, which is used today for many purposes in financial and real sector, is one of the basic requirements of public offerings. The close measurement of companies' values is of great importance in order to protect the capital market investors and company owners from grievances. Valuations are attempting to achieve results that are close to the company's actual value using different methods that valuation specialists use according to their own opinion. Despite the decline in market value of some companies after the public offerings in Turkey, no studies have been found on this subject in the literature which question the valuation methods and compare the successes of them used in the price determination reports published before the public offerings. In this study, at first, the conceptual framework is addressed, company valuation and methods, public offering and stock market types are explained. Then, discounted cash flow (DCF) and market multipliers methods which are the most used methods to determine the public offering equity prices of the manufacturing industry sector company shares offered in Borsa Istanbul (IMKB) after 2010 for the first time are compared. For this, through collective analysis, company, period and market-based analyzes which includes regression and difference analyzes, the closeness of equity values found in the mentioned time periods to the market values have been examined . According to the findings obtained, significant differences were achieved between DCF and market multipliers methods. When the analyzes are considered in aggregate, it is seen that the market multiplier method generally gives closer results to the market value than the DCF method.