Yili Industrial Co., Ltd. Investment Value Analysis Based On Free Cash Flow Discount Mode

With the development of economy, capital market is becoming more and more important, but at present our country capital market still in the early stage, small and medium investor’s philosophy is not yet mature, easy to follow blindly, copycat hype, buying the winners, influent the steady of securities market seriously. Therefore, it is of great significance for investors, especially small and medium-sized investors to set up the correct value investment idea, to master the value investment analysis method s and tools systematically, to form a comprehensive investment value assessment system, analysis and evaluation of the investment value of listed companies objectively.This paper reviews the research related issues at home and abroad, summarizes the relevant theoretical basis about enterprise investment value analysis, discusses the advantages and applicability of free cash flow discount model in the investment value analysis. To solve the difficulties of free cash flow discount model in application, this paper introduces grey prediction model creatively, and expounds the concrete principle and application process of the model. Using a combination of text description and data analysis to explore how the macro-economic operation, the dairy industry development and the company’s performance influence Yili’s investment value from the macro, meso and micro three basic aspects. To provide a reference model for investors to analysis investment value of company comprehensively and qualitatively. On this basis, through collect and collate the concrete project of Yili’s nearly 10 years financial statements,calculate the historical annual free cash flow, and compare with the sample simulation data of grey model, prove that grey prediction model is effective and feasible in terms of free cash flow forecast, which apply to during future free cash flow forecasts. Choose reasonable methods to determine the cost of capital of the enterprise and use free cash flow(DCF) model to estimate the investment value of enterprise, provide a framework for investors to analysis investment value of company precisely and quantitatively, and on this basis puts forward the specific investment advice.