A Case Study Of Franchise Value Assessment Based On Barratt Model Improvement

With the development of social economy and the improvement of people’s living quality,the demand for urban sewage treatment is increasing.As a public utility,municipal sewage treatment project has been covered by the government for a long time.In the long run,financial expenditure can not bear the burden.BOT,namely "build-operation-transfer",is often used in the field of infrastructure construction.BOT mode has both equity and creditor’s rights,which is a common mixed financing mode in public utilities construction.The core of BOT mode is franchise,involving the government,operators,investors and other participants.Although BOT mode has not been introduced for a long time in China,it has been widely and comprehensively applied in the field of infrastructure construction,and has brought good social and economic benefits.This paper takes the problems in the process of franchise valuation under the BOT mode of environmental protection industry as the breakthrough point to analyze and make corresponding improvements.Firstly,this paper analyses the dilemma in the process of infrastructure construction in China,referring to many domestic and foreign literatures,and points out that the franchise under BOT mode is considered as an effective way in the process of environmental protection infrastructure construction in China.Secondly,according to the evaluation background of the selected cases,the particularity of the franchise under BOT mode is analyzed.Then proceeding from the value characteristics of franchise under BOT mode,the advantages and disadvantages of traditional methods in the evaluation of franchise value under BOT mode are analyzed,and appropriate evaluation methods and models are selected.Finally,we use the income method to evaluate the value of the franchise under BOT mode.After obtaining the evaluation results,we analyze the shortcomings in the process of the income method evaluation,and use Barratt model to improve it to make up for the shortcomings in the process of the income method evaluation.In the form of case analysis,combined with the case of AX sewage treatment company’s BOT mode franchise value evaluation,starting from the basic ideas and methods of evaluation,this paper studies the value evaluation of the franchise underBOT mode,which has the value characteristics of intangible assets,and introduces the evaluation idea of Barratt model into the process of public utilities evaluation.In the current context of building a conservation-oriented society,the research of this paper can give more attention to the problems existing in public utilities such as sewage treatment.