Semi-submersible Ship Construction Real Option Game Theory, Decision-making Applied Research

The characteristics of investment in Semi-Submersible Heavy Lift Vessel includes monopolistic competition; uncertainty of the future market; high risk of investment target; investment cycles; massive capital investment in the early stage and etc. The traditional method for ship investment decision analysis is based on Discount Cash Flow (DCF) and represented by Net Present Value (NPV). They operate without consideration of concrete form and variation law of risk and so can not give a correct estimation of the target project. It should be noted that uncertainty is a double-edged sword, which connects with loss and profit alike. So traditional ship investment method can not be good basis for actual decision making. On the other hand, all option method has the following characteristics: asymmetry of investment return and risk (would-be return is higher than would-be loss); avoiding unwanted consequence to the most extent; gaining profit from the good result and may also loss huge opportunity; acknowledging the value of variation and option value rising proportionately to risk. And real option game theory is more perfect for it hybrids game theory analysis of monopolistic competition and manager judgment.Because of technical threshold, there only exists two companies specialize in Semi-Submersible Heavy Lift Vessel market, COSCO and DOCKWISE. This dissertation tries to use real option game theory to analysis investment in this field based on the characteristics of investment in Semi-Submersible Heavy Lift Vessel and real option game method. Through Black-Scholes formula, the author first calculate the value of variation and opportunity which could not get through traditional method, and then analysis 10 year forward revenue and profit under real option theory and finally analyses the two player's decision seeking and its influence to the other in the monopolistic Semi-Submersible Heavy Lift Vessel market based on game theory. By means of Matlab, the author finds the equivalent point which implicates the most suitable investment time, and so can give more correct suggestion for the investor to decide the market condition and risk and in the end makes fine assessment of the target project and correct decision. After the model has been built up, the author analysis the current company condition of COSCO and DOCKWISE, the Semi-Submersible Heavy Lift Vessel market state and its estimation and by data analysis and calculation through the model finds the relative good decision about Semi-Submersible Heavy Lift Vessel investment for each company. The dissertation analyzes the investment strategy under the frame of equivalent investment theory and random changing outward environment and counterpart's decision, which combines quantitative and qualitative analysis.The extended Net Present Value method is based on real option game theory and soul of traditional decision making theories. It is the summary of way of thinking as to uncertainty created by the changing environment. The method embodies quantitative the value of variation, modifies the default of traditional decision making method and so perfects ship investment strategy.