Market Check! - EV/EBITDA multiple trends by sector
Market Check! - EV/EBITDA multiple trends by sector
Looking at six sectors ranging from hardware centric to software centric, this section provides fixed-point observation data for the market multiples of major markets in Japan, the US, and China.
M&As are defined as an important tool for companies in realizing growth
strategies. M&As by Japanese companies both in Japan and overseas continue to increase.
We hope these data will provide you with insight into the M&A transaction trends in the sector to which your company belongs, as well as the recent growing trend of cross-sector M&A transactions.
Changes in EV/EBITDA multiples: Japan
Country comparisons of changes in EV/EBITDA multiples by sector : Japan / USA / China
EV/EBITDA multiples:
Index indicating the enterprise value (EV) multiples against earnings before income tax and depreciation and amortization (EBITDA )
*In this analysis, we determine EV as the total of market capitalization and interest-bearing liabilities. The EBITDA stated is for the most recent 12-month period.
How to calculate multiples
We classify the component issues of representative stock indexes (JPX Nikkei 400; S&P 500, CSI 300) into the following six sectors defined by KPMG: “energy, utilities and communications,” “materials and capital goods,” “automobiles and durable consumables,” “consumer goods and retail,” “IT Internet,” “pharmaceuticals and healthcare.” Then we illustrate them with charts.
Sources
Capital IQ / Bloomberg
Component issues of the six sectors
| Sectors | Industry classification |
|---|---|
| Energy, utilities and communications | Energy-related facilities and services / Oil, gas and consumable fuels / Electrical communications, wireless services, independent power generation business / Electric power, gas, tap water / Comprehensive utilities |
| Materials and capital goods | Chemical, machinery, semi-conductor, aerospace, defense / Metal, mining / Paper products, wood products, containers, packages / Construction, civil works, electrical equipment, architectural materials / Trading companies, distribution, conglomerate automobile parts / Automobiles |
| Automobiles and durable consumables | Durable goods |
| Consumer goods and retail | Retail, sales / Beverage / Foods / Tobacco / Home appliances / Personal goods |
| IT Internet | Internet sales, catalog sales / Interactive media and services / IT services / Software healthcare related |
| Pharmaceuticals and healthcare | Biotechnologies / Pharmaceuticals / Life science tools |
KPMG FAS Newsletter "Driver" Vol.06 - February 2020
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