Valuation of shares is the process of knowing the value of a company's shares. Share valuation is done based on quantitative techniques and share value will vary depending on the market demand and supply. Methods of Valuation of Shares: (1) Asset Backing Method, (2) Yield-Basis Method, (3) Fair Value Method, (4) Return on Capital Employed Method, and (5) Price-Earning Ratio Method. Yield-Basis Method:Yield is the effective rate of return on investments that are invested by the investors. It is always expressed in terms of percentage. Since the valuation of shares is made on the basis of Yield, it is called Yield-Basis Method. Under the Yield-Basis method, the valuation of shares is made on; Profit Basis;Dividend Basis. Profit/ Earning Yield: Shares are valued on the basis of expected earning and the normal rate of return (NRR). Under this method, the value per share is calculated using the below formula:Expected Rate of Earning = \(\frac{Profit\ after\ tax}{Equity\ Share's\ paid-up\ value} \times 100\)Dividend Yield: Under this method, shares are valued on the basis of expected dividend and the normal rate of return (NRR). The value per share is calculated by applying the following formula:Expected rate of dividend = (profit available for dividend/paid-up equity share capital) X 100 Therefore, for calculating the value of equity share by yield method information is required regarding NRR.