Valuation of the Hamrah-e-Aval brand based on brand valuation models using Topsis multi-criteria decision-making model
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RESEARCH ARTICLE
Valuation of the Hamrah‑e‑Aval brand based on brand valuation models using Topsis multi‑criteria decision‑making model Mohammad Aghaei1 Received: 29 May 2020 / Accepted: 11 August 2020 © Springer Nature Limited 2020
Abstract By offering the possibility of accepting the financial value of the brand as a bank guarantee, especially for industries that need constant investment and financing strategies, clear brand value is an advantage in obtaining facilities. The communication industry is among these industries and for this reason, estimation of brand financial value is very important in this industry. Therefore, this study aimed to find a suitable brand financial valuation model using the Topsis method in the mobile phone industry and determine the financial value of the brand of Mobile Telecommunication Company of Iran or Hamrah-e-Aval. This study is an applied and descriptive-survey research. Necessary financial information was collected from the Tehran Stock Exchange, the Company’s financial experts, and related questionnaires. The valuation model was selected using the Topsis method and two models of Intangible Business and Brand Finance were used for the brand valuation of Hamrah-eAval. The findings indicate that the difference in values of these models is because of structural differences and each model’s estimations process, and the results are valid. The results of the research’s main model (Intangible Business) indicate that about 78.1% of the stock value (market value) in this company is related to its brand. Keywords Brand · Brand valuation · Communication industry · Intangible business model · Brand finance model
Introduction In the knowledge-based economic era, the ability of organizations in employing intangible assets forms their main power to create value (Aboody and Lev 1998). In recent years, intangible assets and especially brands have increasing been viewed as crucial determinants of firm value (Barth and Clinch 1998; Bagna et al. 2017); Because, the brands are more than just a name and a logo, today brands considers as an asset of a company and their valuation affects the company revenue (Agarwal et al. 2018). Since the 1980s, practitioners and academics have been researching methods for financial valuing brands (Aaker 1991; Salinas and Ambler 2009). Nowadays, value is ignored and/or confused with the practical concepts of price, cost, and income (Özdilek 2019). Brand value is an important concept in business operations. So, measuring a brand’s value means identifying the sources of this value (Motameni * Mohammad Aghaei [email protected] 1
Faculty of Management and Economics, Tarbiat Modares University, Tehran, Iran
and Shahrokhi 1998). Esteban-Bravo and Lado (2011) indicated that brand value is the added value to brand in the financial field. Therefore, brand value can be interpreted as the financial benefit for enterprise created by brand as assets (Huang 2015). In recent years, due to the lack of financial statement recognition for brands, there has been keen in
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