Research Of Financial Evaluation On BOT Water Project Based On DCF Model

Since reform and opening-up, along with rapid economic development, people's living standards improving, accelerating urbanization, and more and more sewage, urban sewage treatment has become the focus area of government and investors; especially since the Sixteenth Congress, environmental protection is set as a basic national policy, the whole society elevates environmental awareness, thus, water investment projects are rapidly increased. Therefore, to summarize the operational experience of BOT water projects, and to conduct quantitative study of the financial operating results in water supply BOT project, are of very important theoretical and practical significance.Firstly, the meaning, features, advantages and applications of the BOT projects are introduced; then to analyze the financial evaluation for investment projects, especially the sewage BOT project, and financial evaluation are discussed in detail in the methods, content, index system and the formula model, etc. Thirdly, this paper takes Y City sewage treatment H project for example, by use of NPV cash flow models and financial evaluation method, through sewage treatment amount, fee income, maintenance and management costs, tax rates, to measure the Y City BOT wastewater treatment project operating profit after tax during the period, IRR, payback period before tax and other financial evaluation, and the result is that it has a stable income, so the project is feasible.