| Since 1990, China's capital market has been created. A variety of investment ideas and methods are used by the investors in the market. As a scientific investment theory, value investment has been studied by many scholars and analysts in china since 2001. This article characteristic is base on the growth stock and the margin of safety method, propose that value investment analysis core is the Company Equity. The study hopes to find a suitable Chinese Capital Market Value Investment Approach, which can be mastered by the majority of ordinary investors.The article is divided into six parts. The first part is foreign and domestic Value Investment research review. It shows the trends of foreign Value Investment Research, and research in this area at the domestic status quo.The second part, first define contents related to value investment, then it divides the value Investment Analysis into four steps:investment selection, intrinsic value assessment, determine the margin of safety, investment entry and exit decisions. Investment selection focuses on the company's industry characteristics, economic characteristics and risk factors. The intrinsic value assessment, which uses a combination of annual rate of return as the dependent variable, the ROE, price-earnings ratio, price per share as the independent variable ternary function relationship established to assess the intrinsic value of the dynamic. Margin of safety is an risk aversion method of investment, the article consider it is like as a conservative valuation approach.The Third part and the fourth part focus mainly on empirical analysis using the case method, which describes the research evidence and method of value investment in details. According to the analysis made to determine the margin of safety three principles. Do case analysis on the Pharmaceutical Industry, and uses Kangmei Pharmaceutical Co., Ltd to do empirical analysis. Empirical analysis shows that this method of valuation can help investors determine the risk and return expectations reasonable. Use value investment analysis, investors can know what price can invest in those stocks.The fifth part, with value investing method to analyze the issue of value creation. First to use the value chain approach analyzed on the Pharmaceutical Industry, then it do case studies for the value creation in the strategic direction and financial guidance. The article considers that in the value investment-led capital markets, investors can "vote with their feet" to choose that investment target for the company value creation. Return on shareholder value creation, while the company can get a good financing environment.Based on past theory and method of value investing study, this article research and discussion can provide to investors the value investment analysis methods on listed companies. This dynamic method analysis for listed companies in China's capital market has some applicability. According to the investment valuation process model comparing to the ternary function equation model is innovative. The method can also be the investment process analysis, which is linked with the company value creation through investment analysis to find factors that affect value creation. The analysis method, which links with the company, the interests of investors and stock market prices, helps investors make rational investment decisions. In the demonstration case studies are combined with empirical data, through a comprehensive system of case specific analysis of the value of the investment approach of the study to help investors and investment analysts to master this method is more convenient. |
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