The Application Of Residual Income Valuation Model In The Valuation Of The Real Estate Business: VANKE

The real estate industry is an important component of the national economic system,which plays a major positive role in promoting urban construction, promoting economicgrowth and improving living standards. With the real estate industry becoming more andmore prominent in people’s hearts, people’s attention to the value of the company is alsoincreasing. Therefore, under the current economic environment, the research for the valueof the real estate industry has an important theoretical and practical significance.Thesis describes the theory of the status,character and value of the real estateassessment, then details the residual income model,but in view of the inherent defects ofthe income approach, thesis improve the original model, we introduce the book value endof the forecast period and DuPont financial analysis mode, which overcome evils of theoriginal model in the future long-term gains capitalized and the difficult to estimateresidual income and vulnerable to subjective effects. The full use of the accountinginformation ensures the credibility and accuracy of the estimation results Finally, thispaper gives a comprehensive systematic assessment to VANKE as a case, thesis analyzesVanke’s operation, business strategy and competitive advantages; Then, combing with thecompany’s financial statements, thesis analyzes the financial condition, results ofoperations and prospects for the development solvency in the view of profitability,operational capabilities and development capacity and use the improved residual incomemodel to assess the value of VANKE and analyze the evaluation results. Thesis combinesthe theory and case studies to explore the use of the residual income model in thevaluation of real estate enterprises. The research has references to the study of the realestate business valuation, and provides a new way of thinking to which we should paymore attention on the residual value that created by investor in the future which is morethan the basic pay, and helps investors to form right investment decisions.