| From China’s economic development in recent decades, it can be found that the real estate industry has been flourishing and has gradually become a pillar industry of national economic income. Today, one of the most important directions of China’s fixed asset investment is the real estate industry. With the development of the industry, the evaluation of the value for the real estate development enterprise has attracted more and more attention. It is developed based on the maximization of enterprise value and enterprise merger and acquisition. Through the value assessment,enterprises can improve the business strategy and management methods, and influence the enterprise merger and acquisition activity and investors’ decision. With the expansion of mergers and acquisitions of the real estate enterprises, how to make a reasonable valuation of the acquisition for the enterprises is particularly important.This paper first introduces the research background and significance, and makes a brief introduction of the current research situation of the residual income model at home and abroad; the preliminary understanding of the real estate industry and the residual income model laid the theoretical foundation for the following research. Then, this paper introduces the current situation and characteristics of China’s real estate industry, and analyzes the applicability and limitations of each method by using the commonly-used evaluation methods. Based on these defects,this paper will smoothly introduce the residual income model. Aiming at the basic principle and the basic form of the model as well as the analysis of the advantages and disadvantages, this paper will adjust and improve the model combining the characteristics of the real estate industry .Finally, this paper will use Poly company as a case study ,through the analysis of the business and financial capacity of Poly company, the financial index of Poly will be forecast ; By using the residual income model to assess the value of Poly and compare the current share price to do comparative analysis , it can be verified the effectiveness of the value evaluation of real estate development enterprises , and find out the reasons of the differences as well as suggestions for improvement.This paper explores the effectiveness of the residual income model in the value evaluation of the real estate by combining the theoretical research and case analysis method; the improved residual income model provides a new way for evaluation,but also enriches the research of residual income model theory. From the perspective of the value creation, the residual income model can better reflect the value creation ability of the enterprises, which can help investors to form the correct investment decision. |
