Discount for Lack of Marketability (DLOM)

A valuation discount applied to closely-held, private company shares to reflect the absence of a ready market compared to listed equivalents.

Buyer Example

Buyer valuing a family-owned Rajkot forging unit uses listed peer multiples of 8x EBITDA but applies a 25% DLOM given the illiquid, single-buyer nature of the transaction, arriving at an effective 6x offer.