A Research On Business Valuation Methods And Evaluation For Vanke Group

Referred to the mature western enterprise value evaluation method,this paper evaluates the advantages and disadvantages of each method.Because the Chinese market is not mature,the legal system is not perfect or the characteristics of the real estate industry is not suitable,the methods,which will be used in this paper,limited to discounted cash flow method,the relative valuation and economic value-added method.The economic value-added method developed from the idea of surplus income concept.The economic value added represents the operating profit after tax minus the cost of debt and equity income.Compared to traditional indicators,EVA has a more accurate measurement of performance and relevance of the more features.Cash flow discount method is a more mature valuation method,by predicting the company's future free cash flow and capital costs.The present value of the future cash flow is the value of the company,which takes into account the time value and risk of funds.The main indicator of relative valuation method is price-earnings ratio and other key indicators.The comparison of the key indicators of the reference enterprises,the market value of the enterprise can be amended.All these methods are based on detailed forecast of each item,so the forecast method and the details will be described in detail in the second and third part.Now Vanke Group is in an unstable status,the price-earnings ratio usually can not represent the true profitability.Therefore,the three methods must be combined,aided by comparative analysis and regression analysis,to acquire the most reasonable results.The analysis will provide a reference for information needs,and help the future application research of enterprise valuation methods.