This case is about FINANCIAL ANALYSIS, FINANCIAL MARKETS

PUBLICATION DATE: January 01, 2000

Tom.com: Valuation of an Asian Internet Company  Case Solution

The online investment craze was starting to grow in Hong Kong. Tom.com Ltd., a Hong Kong-based Internet company, was planning an initial public offering at the Hong Kong Stock Exchange. A portfolio manager for EuroGlobal Funds was to provide his professional opinion on its appropriateness for different investors and the value of this investment.

He was not unaware of the difficulties in valuing Internet companies and the debate over the choice of valuation procedures. Among these, one tactic was to examine the tacit hyper-growth rate that Internet companies had to reach in the next five years to warrant their current valuations. He determined to implement this approach to Tom.com.

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