The Value Evaluation Research Of An Hui W Energy Company Limited Based On The Residual Income Model

Utility industry is a basic industry of national economy relating People’s Daily life.Therefore, it’s of great significance to evaluate the power generation enterprises effectively forthe development of the electric power industry healthily, in turn to provide correct guidanceand evaluation for the national economy. Moreover, power plate market is becoming more andmore rich with the development of economy and the reform of electric power system, thecharacteristic of its stable earnings has attracted more and more investors’ attention, so how toeffectively evaluate power generation enterprise has become a hotspot and difficulty of thecapital market. In the future, the competition among power generation enterprises will bemore intense accompanied by the market-oriented reform of electricity price. The research ofpower generation enterprises’ value assessment methods will has direct guidance andreference significance for the more active capital operation in the future.Power generation industry in China are mostly thermal power due to the reason ofresource endowment, economic development stage and technical restriction. So we introducethe residual income model into the evaluation of thermal power enterprises in our country toprovide a model for reference for thermal power enterprise value assessment under thebackground of value management era. Firstly this paper explains the relative advantages ofthe residual income model comparatively through the introduction of traditional evaluationmethods. Secondly, we conduct the sublation and deepening of the past research on theimprovement of residual income model on the basis of fully analyzing the characteristics ofthe thermal power industry, to find out a evaluation idea which is suitable for the evaluation ofthermal power enterprise. Finally, we take An Hui W energy Company Limited, a regionallarge-scale listed company, as research object to carry on a empirical research and validation.The empirical study shows that valuation of An Hui W energy Company Limitedapplying the improved model can well explain its market value, and the value-drivingfactors analysis which derives from the residual income model can well explain the historicalstock price changes of An Hui W energy Company Limited. So, we testify the validity of theimproved model in the evaluation of the thermal power industry enterprises, to provide aapplicable evaluation method with strong operability for similar enterprises. Finally, we verifythe validity of the model improvement ideas and relative superiority of the improved modelthrough contrastive analysis with the evaluation results applying the residual income modelbefore optimization.