Financial Evaluation Research On Steelmaking Convertor Project Undertaken By Jinan Steel Stock Ltd., Inc

Shandong province's steel industry plays a significant role over the whole nation, with number of companies ranking the fifth , output the third, sales and gross profit the third and the fourth respectively. However ,there still exists such prominent problems with the industry in Shandong as relative backwardness in equipment , pressure on energy-saving and emission-decreasing, unreasonableness of production arrangement, lower-ranking product positioning and weak competitivity etc. So, obviously it has become a certain strategy for the industry to control gross output, increase the concentration level and improve the equipment level. According to the national industry policies and development trends around the world, based on the requirement for industry structure adjustment, considering the needs to self- development on eliminating outmoded capacity, optimizing structure and decreasing resource and energy consumption, Jinan steel stock Ltd., Inc decides to construct a 120t convertor steelmaking project. Because of the special feature of the large investment and the uncertain factor associated, it is necessary to implement overall evaluation ,especially financial evaluation in order to seek a successful investment.Applying with comprehensively methods such as literature research, specialist interviewing, combination of theory analysis and practical research, beginning with the basic theory of project financial evaluation, considering the feature of steel industry project, the author makes exploration and analysis to the practical application in steel industry project investment of financial evaluation method, which is systematic and scientific, with aiming to provide an ideal reference for similar project evaluation within the industry. Moreover, taking this project as an example, focusing on investment and financing, profitability, payment ability and uncertainty of the projects, the author makes detailed financial and risk analysis. For the issues found through the analysis, the author provides some suggestions to improve the financial evaluation of steel projects and reaches a scientific and reasonable conclusion.