Research On Enterprise Value Evaluation Of G Company Based On Operating Residual Income Model

With the continuous development of China's capital market,more and more investors and managers in the transaction and decision-making began to establish a "value investment" concept,marking the new era of value management coming.Enterprise value evaluation plays an important role in stock trading,corporate mergers and acquisitions,listing pricing and investment decision-making.Therefore,the theoretical and practical circles have put forward higher requirements for scientific and accurate evaluation of enterprise value.Energy conservation and environmental protection industry is an important industry related to our national economy.Thirteen Five Year Plan proposed that the environmental protection industry would be created into a pillar industry of China's economy in 2020.G Company is one of the waste heat and pressure comprehensive utilization Services Company under the energy-saving and environmental protection industry,with the high-speed growth path.Under "the Belt and Road Initiatives" background,G Company has a strong sustainable development capacity and broad value growth space.However,due to the effect of "Supply Side Reform",the G company's performance declined for two consecutive years,which operating income fell to 9.73%,and total profit fell to 4.14%.G's investors and managers are eager to know the intrinsic value of G Company.So an accurate value assessment of G Company's corporate value attracts extensive attention.At present,there are four kinds of enterprise value evaluation methods,namely,cost method,market method,option pricing method and income method.The Operating Residual Income Model is a typical representative approach of the income method,and its prominent feature is that it is very suitable for the growth of enterprise valuation.At the same time,the model also affirmed the role of accounting information's value in the company.Besides,the model emphasizes that the value of the enterprise is mainly coming from creation rather than distribution,and coming from business activities rather than financial activities,truly reflects the essence of the residual income method "value creation".In this paper,we select the G Company as the research object in the energy management and environmental protection industry,based on the "enterprise value maximization" financial management perspective,and use the improved Operating Residual Income Model to evaluate and analyze the G Compay's operating residual,the overall value of the enterprise and its main drive factors.Then,we analyze sensitivity and validity of the assessment results and calculate the possible range of changes.Finally,in the actual situation,we put forward targeted management recommendations,and summarize the practical application of the Operating Residual Income Model in the enterprise value evaluation.Through the research of this paper,it will help to provide reference for the determination of the overall value of G Company,so that investors in the stock market are able to determine the transaction price,and managers in the company are able to provide management advice.In addition,it will also help to establish a set of practical valuation system which the energy-saving and environmental protection enterprises can meet the value creation theory,and provide reference for the enterprise value assessment.