Research On The Value Evaluation Of Real Estate Listed Enterprises Based On Free Cash Flow Discount

The real estate industry is the pillar industry of national economy. Its healthy development can help to promote the sustainable and healthy development of national economy, improve people’s living standards. Since the1990s, with the deepening of China’s housing system reform, the real estate companies can continue to increase, and a batch of listed companies to succeed, and then become leaders in the industry. However, due to the marketization of China’s real estate industry level is still low, most real estate enterprises are still in the growth stage, the enterprises in the equity structure, the differences between the management modes and so on, will affect the investors for their accurate valuation. Accurate valuation of real estate enterprises can provide to investors with better information, and make sure that they are in good condition of the whole real estate industry, and thus for the portfolio optimization adjustment.In this paper, it is carried on the review and summarizes the domestic and international relevant assessment of enterprise value theory, and comparatively analyzes the advantages and disadvantages of the enterprise value evaluation method which is applied to real estate enterprise valuation. Then, through the case of YL company valuation analysis, I draw the corresponding conclusions finally. This article mainly includes the following contents. Firstly, it is analyzed on the real situation. The author analyze the overall situation of China’s real estate industry with some aspects as financial indicators from the development prophase planning to after-sale; and further analyze the plight and the problems of the real estate enterprises in China. Secondly, it is mainly constructed the theoretical analysis framework. By analyzing the differences of the asset base method, income method, relative valuation method and the option valuation method, I clearly put forward that the free cash flow discount valuation method is more suitable in the valuation of listed real estate enterprises in our country. Thirdly, it is chosen the model in this paper. It is discussed several models of income approach, such as FCFF, EVA, DDM, FCFE, and so on. Then it is determined the theory application model in this paper. Fourthly, it is case analysis. With the example of YL Company, this paper is discussed free cash flow discount method in the concrete application of real estate valuation of listed companies in our country. And then by using financial data of YL Company, this paper is getting the corresponding conclusions according to the evaluation model which are analyzed above.