Research On Relationship Between Diversification Operation Strategy And Corporate Performance

At present,the diversification enthusiasm of listed companies in China is constantly rising,and many listed companies have diversified and expanded.For example,Evergrande Group has expanded from real estate to sports,culture,and Mineral Water,etc.Wanda Group diversified into the entertainment industry while in the process of de-localization.The Hangzhou Wahaha Group involved in commercial real estate as a leading company in the apparel industry,Youngor uses Clothing,real estate,equity investment as the main business.The overall performance of enterprises has achieved rapid growth.In the trend of diversification in our country,some enterprises have succeeded in redeveloping through diversification,while others have failed.As a result,its real estate and investment businesses have expanded rapidly,and the apparel industry has developed slowly.The question of whether to diversify and how to expand is a challenge for listed companies.Therefore,it is necessary to clarify the economic consequences of diversification and to explore how enterprises can improve their performance level through diversified development.All in all,searching for new performance growth points,pursuing synergy,and the dispersing risk are the driving forces for Younger's diversification strategy.In terms of the profitability of segmented industries,the performance of the apparel industry has been steady with a little declined.The profit levels of the real estate and investment sectors have reversed.Younger's diversified expansion has expanded the size of the company and increased the value of the company in the capital market.At the same time,over-investment in the real estate sector and the investment sector has also brought greater financial risks to the company,which is detrimental to the long-term performance of the company.At present,China's traditional manufacturing industry as a whole is down,the property market and the stock market are going in reverse.The conclusions of this paper have an important guiding significance for the traditional manufacturing industry to achieve financial balance and improve performance through diversification.