What Is Marlow Chemicals Worth? A Comparables Analysis
Finance
easy40 min0 submissionsFlipkart
Scenario
Marlow Chemicals (specialty chemicals, India) is preparing for a sale process. You have been asked to establish a valuation range using trading comparables.
The company. Revenue of ₹484 Cr, EBITDA margin of 23% (EBITDA of ₹111 Cr), revenue growth of 21%, and net debt of ₹100 Cr.
Trading comparables.
| Peer | EV/EBITDA | Revenue growth | EBITDA margin |
|---|---|---|---|
| Peer A — same sector, 3× larger | 8.5× | 10% | 27% |
| Peer B — adjacent sector, high growth | 11.1× | 32% | 19% |
| Peer C — same sector, declining | 7.1× | 1% | 20% |
The banker running the process has proposed simply averaging the three multiples.
Supporting data
target
- ebitda cr
- 111
- revenue cr
- 484
- net debt cr
- 100
- ebitda margin pct
- 23
- revenue growth pct
- 21
comparables
| peer | ev ebitda | growth pct | margin pct |
|---|---|---|---|
| A | 8.5 | 10 | 27 |
| B | 11.1 | 32 | 19 |
| C | 7.1 | 1 | 20 |
Your task
Produce a valuation range. Provide:
- Analysis — which comparables you would use and why, and the resulting enterprise and equity values.
- Risks — where this methodology could mislead.
- Recommendation — your valuation range and the number you would take to the seller.
Critique the banker's proposed approach.
Ready to move forward? Up next: Solstice Travel: Is This Target Growing, or Just Floating?Next question
How you'll be graded
100 points, 60% to pass.
- adjustments20
- peer selection25
- recommendation30
- multiple analysis25
Hint
Reveal suggested structure
- Screen the peers on growth, margin and risk — not sector label alone.
- Apply the defensible multiple range to EBITDA to get enterprise value.
- Bridge to equity value: EV − net debt.
- Adjust for size, growth differential and marketability.
- Cross-check with EV/Revenue.
- Present a range, and say where in it you would settle.