A Case Analysis Of CHINA Quanjude Group Valuation Research

As an organic whole, enterprise value assessment is a comprehensive analysis of thetarget enterprise. It can help managers make better operation strategy and supply aconvenient way for investors to locate the investment value of the company. In a more andmore developed capital market, enterprise value assessment plays a more and moresignificant role and has been used in a broader field.Quanjude Group, the first listed company in the catering industry, has established anoutstanding reputation and won wide acclaim, depending on its unique skill and customeroriented service. With a proud history, time-honored catering companies have constitutesan integral part of traditional Chinese cultural. In recent years, as many westernrestaurants entered Chinese catering business in a mad rush, Chinese traditional cateringenterprises has undertaken great pressure of competition and faced a crucial challenge.Under this circumstance, this paper applies the essential theory and method of enterprisevalue assessment to Quanjude case study. As background analysis, we use SWOT modelto consider the history and the present situation of China’s catering industry to achieve acomprehensive understanding of Quanjude’s external environment. Then, we discuss itsoperating and financial conditions to offer necessary information for the next step. At last,we utilize FCFF method to estimate the internal value of Quanjude and examine theadvantages and disadvantages of the method.