Research On The Valuation Of KN Cash Loan Company

With the overall popularization of mobile Internet,the Internet payday loan business has emerged in the face of the financial needs that more than 80% of China's credit system is not covered by people,and it presents the trend of rapid growth,and as the hot spot of the capital market,the KN Company is the first echelon enterprise in the payday loan industry with the highest market size and excellent development prospect.YY Company is an Internet company listed in Hong Kong,which is making the layout and transformation of Internet finance and it is intended to promote the improvement of the company's ecology and the synergy between the businesses through the acquisition of KN Company,thereby enhancing its value in the capital market.Therefore,how to dispel the mist of Internet capital,how to make reasonable and effective valuation of KN Company,and how to evaluate the synergistic effect after the acquisition on valuation are urgent problems.In this paper,based on the analysis of business characteristics and collaborative field between KN Company and YY Company,the user life cycle value model is selected as the intrinsic value evaluation method for the acquisition of KN Company through the analysis of the advantages and disadvantages and the precondition of application of various valuation methods on traditional companies and Internet companies.At first,the theoretical basis and thinking of this model are analyzed and expounded in this paper,and partial optimization of the existing user life cycle value model is conducted through adding three new parameters of user cost,user growth rate and synergy coefficient,in order to reflect the value of users and the intrinsic value of synergistic effect more accurately.Then,the financial indicators,business indicators and application steps needed for the model are sorted out,and then the intrinsic value assessment of KN Company is conducted according to the application steps.In the first step,it was found that ARPU0 was 654.87 yuan,the customer cost was 121.34 yuan,the credit cost was 25.90 yuan,and the bad-debt cost was 526.17 yuan through studying the business structure and profit model of KN Company,analyzing the main components of its revenue and cost,and estimating financial indicators from the three dimensions of the financial regulations,the data of similar companies in the market,and the historical data of KN Company.In the second step,it was concluded that the initial number of users was 1.482 million,and the annual growth rate of users in 5 years was 44.76% through estimating the market index of KN Company in the valuation model,in the meanwhile,it is concluded that the synergy coefficient was 112% through the analysis and comparison of KN Company and YY Company's user portrait with considering the value of user reuse.In the third step,it is concluded that the intrinsic value of KN Company was 232.9 billion yuan through the calculation in the user life cycle value model based on the data of the first and second steps above,which is higher than the price of 2.2 billion yuan estimated by market approach,and the negotiation price of YY Company and KN Company was 2 billion yuan.This paper provides a quantitative investment decision basis for YY Company,and a reference for valuation system for the valuation of the same industry through the valuation study after the acquisition of KN Payday Loan Company,in order to help enterprises and investors gradually return to rational valuation,which is beneficial to the long-term healthy development of the industry.