Study On Equity Valuation Method Afterdebt Equity Conversion

In recent years,in the face of global overcapacity,China's economy is also facing major challenges,and the real economy is in trouble.Based on this,the state has promoted the supply-side reform one after another,formulated and released plans such as "vision and action for promoting the construction of silk road economic belt and the 21 st century maritime silk road",and proposed "debt-for-equity swap" as a supplementary method for "supply-side reform".Debt and equity swaps,with an emphasis on a market-oriented approach and the establishment of market-based rules for prices,are an opportunity for the real economy to regain its vitality.However,it should not be neglected that in the market-oriented debt-to-equity swap process,the equity value assessment after debt-to-equity swap is of vital importance to both the creditor whose creditor's rights are converted into equity rights,the investor or the enterprises themselves.One Belt And One Road and other plans and supplementary methods provide new ideas for the business development of relevant enterprises in China's port and shipping industry.Therefore,this paper takes Changhang phoenix,a typical enterprise in the debt-to-equity swap sector in the port and shipping industry,as the research object to evaluate its market-oriented equity value after the debt-to-equity swap.This paper first starts from the theory,elaborated the enterprise debt to share and the stock right value appraisal related theory,and on the theoretical basis has carried on the debt to share and the stock right value type definition,and theoretically has clarified the debt to share to the stock right value influence.In terms of connotation,it clearly distinguishes the concepts of equity value,enterprise overall value and market value.Then,in terms of evaluation methods,this paper comprehensively analyzes the applicability of various evaluation methods for the special economic behavior of debt-to-equity swap.This paper mainly USES the free cash flow discount model and residual income method to evaluate and analyze the equity value after Changhang phoenix debt-to-equity swap.In the part of case analysis,this paper selects the case analysis of Changhang phoenix company to evaluate the equity value after debt-to-equity swap.After introducing the basic situation of Changhang phoenix,the analysis of the causes of debt and the operating conditions and procedures of debt-to-equity swap;This paper analyzes the economic environment Changhang phoenix is located in,its industry--port shipping industry development status and prospects;Then,the free cash flow discount model and residual income model are used to evaluate the equity value of Changhang phoenix,and to verify and compare.Finally,compared with the FCF discount method,which indirectly evaluates the equity value of Changhang phoenix company after debt equity conversion,the residual income model directly evaluates the equity value of Changhang phoenix company after debt equity conversion,which is more objective and accurate and reduces the subjective prediction of relevant indicators.Finally,the conclusion and enlightenment are obtained from this case.It is hoped that the equity value evaluation after debt-for-equity swap can be improved to make a certain contribution to the expansion and real implementation of market-oriented debt-for-equity swap and promote the equity transfer under market-oriented debt-for-equity swap.This provides a new reference basis for other enterprises to conduct market-oriented debt-for-equity swap and equity transfer.