Analyse Real Estate A Share’ Value Of Mergers And Acquisitions During The Transition

A new round of real estate adjustment cycle began in 2014 compared with adjustment cycle 2008 and 2012, there are big differences. Firstly, the changes of liquidity are more close to the background of overall economic transition. Then, M2 growth too fast and too low will be replaced by the stability of a certain interval. Next, the real estate industry policy will gradually return to mercerization. Thus, the segmentation of regional city and the difference between enterprise management enhanced constantly. And the four factors together, will make the real estate industry’s development more regression real demand, which is also the industrial evolution cycle change is the change of population structure of the decision.According to the structure of the population roughly estimate, a new round of growth in domestic real estate subsequently development depends on the demand of improvement probably appear after 2020. As a result, in the current real estate sales, price growth elasticity gradually downward movement of initial stage, the real estate value of A shares after 2010 is obviously lower position compared to the previous cycle. Moreover, the relatively lower position is expected to be maintained for a long time in the transition. In summary, the over-earnings of real estate A shares will more depends on mergers and acquisitions.This essay profoundly analysis the abnormal stock price performance of Gemdale Corporation, Financial Street Holdings and New Huangpu in the first half of 2014. Meanwhile, this essay evaluated merger case of USA listing Corporation Pulte Homes and Centex, also the demerger case of Marriott. It’s obviously that when the real estate industry has entered the transition period and relatively undervalued become the normalcy, value of Merger and Acquisition should be able to show as the stock price excess returns. Certainly, the value of Merger and Acquisition needs listing corporation itself at a relatively undervalued level, furthermore, is whether the value of Merger and Acquisition can eventually derived new growth engine or pattern.On this view, this essay based on three selected standard including industry integration, the expected powerful alliances, the special value besides real estate business. In conclusion, during the process of the new normal economy’s growth and real estate sales tend to depression, Vanke, China Merchants, RiseSun, Oceanwide holdings, Lujiazui, Zhangjiang Hi-tech and Overseas Chinese town are potential targets which conform to the value of the mergers and acquisitions will finally turn to the stock excess return.In addition, the innovation of this essay is to comprehend how to change the existing market pricing model in the new normalcy through the comparative study of real estate A shares. More important, current economic growth is downward movement, and generally cyclical industry will experience a relatively low valuation period, a part of cyclical stocks can be revaluated by present the value of Merger and Acquisition to a certain extent.