Research On The Value Evaluation Of Listed Power Company In Income Method Improved By Monte Carlo

With the acceleration development of electric power system reform,the electric power market have become more and more mature, the mergers and acquisitions, restructuring, equity transactions, venture capital and other property rights exchange have become increasingly frequent, listed power companies as a representative of power generation enterprises in China,It’s development concept,management mode and profit mode have occur a great changes,which will directly or indirectly affect the enterprise own value.Therefore,scientific and accurate evaluation of listed power enterprise can provies the basis when the listed power companies in the capital market for trading activities;can also make the listed power enterprise management clear of its value and provide the reference when they make the right investment decision.Income approach as the most commonly used method in the asset appraisal methods,it is especially suitable to evaluate the listed power enterprise whose income is stable and operation is solid.But the evaluated objects are being in the changing markte, affected by external macro environmeng,industry environment and internal environment,combined with the traditional income approach assumptions for complete information,which ignoring the uncertainty of the evaluation model,and the evaluation results are usually point estimates. All of these make the accuracy and scientific nature reduced by the income method of enterprise value.For the above problems,the article first from the two aspects of the listed power companies own uncertainty and free cash flow model parameter uncertainty,to points out the problems of the free cash flow model and then points out the necessary of the improving.Secondly, introducing the sensitivity analysis to analys the uncertain paramenters of free cash flow,K-S inspection technology to test the probability distribution of bariables,Monte Carlo simulation technique to have a large number of simulation test, and finally presented the evaluation result in the form of interval value. Finally,combining with Huadian power international,a liste power companies for empirical analysis,to compared with the results from both the traditional free cash flow model and the improved free cash flow model which based on Monte Carlo simulation,and then confirmed the improved model can cover more uncertainty and more informations, all of these are adapting to the evaluation of “interval” international trend and they help users of the evaluation obtain more accurate evaluation results.