P&M SPECIALISATION MATRIX

The Specialisation Spectrum — From Standard to Highly Specialised

Plant and machinery exists across a spectrum from standard, widely-traded commodity equipment to highly specialised, single-purpose equipment. Where an asset sits on this spectrum influences both the primary valuation methodology and the liquidation discount applicable to it.

01 Standard

04 Highly Specialised

01 HIGH LIQUIDITY

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Standard / Commodity Equipment

Standard equipment has an active secondary market with multiple buyers, established price discovery and dealer networks that provide liquidity.

Commercial Vehicles HVAC Chillers Cooling Towers Transformers Switchgear IT Servers Agricultural Tractors Forklifts

PRIMARY METHOD Market Comparison

LIQUIDATION VALUE 70–80% of MV

Secondary market pricing directly establishes Fair Market Value, subject to condition and sale circumstances.

02 MODERATE LIQUIDITY

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Industrial / General-Purpose Machinery

General-purpose industrial machinery has a secondary market with fewer active buyers than commodity equipment, requiring deeper technical assessment.

CNC Machining Centres Hydraulic Presses Injection Moulding Textile Machinery Ring Spinning Weaving Machinery

PRIMARY METHOD DRC / Cost Approach

LIQUIDATION VALUE 60–70% of MV

DRC is cross-checked against used machinery dealer data and available secondary-market comparables.

03 LOWER LIQUIDITY

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Process-Specific / Sector-Specific Machinery

Machinery designed for a particular industrial process has a narrower buyer pool, making technical functionality and market depth critical to the valuation.

Pharmaceutical Lines Food Processing Chemical Equipment Printing Machinery Paper Machinery

PRIMARY METHOD DRC / Cost Approach

LIQUIDATION VALUE 50–65% of MV

Secondary comparables may be limited because the potential buyer universe is sector-specific.

04 VERY LOW LIQUIDITY

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Highly Specialised / Single-Purpose Equipment

Highly specialised equipment may have an extremely narrow buyer pool, potentially limited to companies producing the same specific product or operating the same process.

Sterile Filling Lines Semiconductor Equipment Aerospace Tooling Custom Chemical Reactors API-Specific Equipment

VALUATION CEILING DRC

LIQUIDATION VALUE 20–40% of MV

Buyer-pool depth becomes a critical determination because a forced sale may realise only a fraction of the DRC-based value.

VALUATION INTELLIGENCE

The more specialised the equipment, the deeper the market analysis required.

The spectrum is not simply an equipment classification. It determines how much weight should be placed on secondary-market evidence, DRC, condition, functionality and buyer-pool depth when arriving at a defensible valuation conclusion.

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