The Growth Enterprise Martet Of The Company Valuation Research In China

The development of domestic’s Growth Enterprise Market (GEM) has beenattracted by investors for so long. The GEM is a capital market platformpositioning for providing service for the Hi-tech enterprises, which had beenmade significant function for promoting domestic’s development and adjustingeconomic structure. Meantime, the highly valuation ration for GEM has been along time argument. Thus, considering the GEM’s problems and the comparisonlevel rational is a vital issue.There are two considerations for setting up the domestic’s GEM. Firstly, tosolve the financing difficult situations for the domestic’s small and medium-sizedenterprises in order to increase the direct financing ratio. Secondly, letting theventure capital and equity investment could quit the market effectively, in thisway, transfer its investment into the national supporting strategic emergingindustries, as the result, helping upgrading other industrial structures. If theGEM has not formed the money making effect, can’t effectively solve the problemof excess liquidity, to alleviate the high savings rate in China, can’t reduce theproportion of indirect financing, effective allocation of social resources can’t beformed. Then the GEM is likely to face the risk of failure.This paper analyzed the current situations of domestic’s GEM and the GEMlisted companies, also it has a brief explanation on evaluating the rise of GEMand its development. The basic concept of GEM evaluation is being introduced,also the common ways of evaluation was compared, the reason the GEM highvaluation is analyzed in detail. Furthermore, there are case study of two GEMlisted companies, by analyzing the causes of the current gem high valuations ofthe company. And then, a rationalization suggestion was proposed, finally, there isthe conclusion about China’s GEM listed enterprise’s evaluated.The GEM has undertaken great history responsibility for upgradingstrategic emerging industries and optimizing the capital market platform oneconomic development organization. China’s economic has been through age oftransformation, various revolutions are in the progress right now. Solving the problems of GEM development issues in order to provide better service for smalland medium-sized enterprises also the real economy, in this way, the investorscould sharing the profit which comes from the excellent listed company. Last butnot least, it also could makes effort for the China’s economic development.