Transmission And Distribution Of Electrical Industry Companies Overall Profitability Analysis

Power transmission&distribution is a very important equipment manufacturing industry in our country, with the continuous increase of power grid investment, the gradual recovery of international economy and the development of domestic12th five-year plan, the entire industry will maintain steady growth in next five years. However, at present the low industry concentration and the poor condition of enterprises profit result in that the growth of overall margins is in the decline situation recently. Good profitability is key to the steady management and sustained development for enterprises; meanwhile, it is also the strong guarantee for sustainable competitive advantage. Therefore, it’s so essential to research the overall profitability of power transmission and distribution industry.This paper has a comprehensive analysis and Research on profitability of listed companies in China’s power transmission and distribution industry. Firstly the main text of thesis presents the basic concept and theory of profitability, gives a index of measuring profitability, then introduces the conception, characteristic and classification of power transmission and distribution industry, describes the development status of Power transmission and distribution industry in China and analyzes the industry’s economic environment and industrial policy. Secondly selects64representative listed companies in this industry as the research object, collects these companies’ financial data and other economic data from2011to2012, Statistically analyzes the monomial index of profitability, in addition, classifies the64companies in terms of the sub industry, scale of operation, area and the capital structure to comparatively analyze profitability of various companies in multi dimension. Meanwhile, selects the profitability index of representative, reasonably determines the weight, constructs the comprehensive profitability evaluation system and comprehensive profitability index and calculates comprehensive profitability index of the sample companies to rate and analyze calculation results. Finally, combines with the actual situation of Zhejiang CHINT electric Co. to carry on the case analysis to its profitability and comprehensive profitability index and points out that the driving factors and restraining factors of the company for achieving good profitability, therefore, some suggestions are given to improve the company’s profitability.The basic conclusion of this thesis is:at present, because of the low industry concentration and intense homogeneous competition, the overall profitability for our country’s power transmission and distribution industry is poor. In the sub industry, the power distribution switch industry’s profitability is relatively strong, the profitability of smaller enterprises is better than larger enterprises. At the same time as the financial leverage effect doesn’t work, consequently the companies with low asset-liability ratio have a better profitability. In the case analysis, because of its channel, cost, brand and technical superiority, Zhejiang CHINT electrics Co., has a good profitability, however, increased competition; internal management efficiency and the risk with expansion of overseas markets also have effect on the profitability.