Financial Analysis Of Beijing Capital Land LTD.

From the beginning of 2003, the macro-economy of China and the real estatemarket began to show the tendency of over-heated. When 2004 comes, thegovernment of China enact a serial of polices to control this tendency. The BeijingCapital Land LTD (BCL) is one of the most powerful real estate companies in Beijing,and it's also a H-share company. Now BCL is actively preparing for A-share listing.The paper is aimed at analyzing the financial status and prospect of BCL from anindependent third party's role, and helping the investors and the creditors have a goodunderstand of BCL and the specialty of the real estate industry, and the impact of thegovernment's policies, so as to provide a reference to the investors and creditors. The paper has four parts. The first part is a survey of BCL and an introduction ofthe real estate industry and the market. The second part introduces the financialspecialty of the real estate company, and makes an accounting analysis. The third partanalyses the financial status of BCL, including measuring the company's profitability,the company's ability to pay debts, and the cash flows of BCL and so on. The fourthpart has an analysis of the prospect of the company, and offers managementrecommendation. According to the paper, BCL's underperformance of financial year2003 is a frequent fluctuation among real estate companies. But as the company isexpanding too rapidly, it faces financial risk. BCL's prospect is under the influence ofthe land policy, the financial policy and other policies as well. To make a rightdecision, the investors and the creditors should keep a keen eye on the above policies.