The Analysis And Evaluation Of The Enterprise Value Of The SDIC Power Holdings Co., Ltd Based On The EVA Method

With the rapid growth of the Chinese economy, the environmental issues are also getting more serious in China. The degradation of the living environment has come a threaten to people's health. Therefore, the central committee of the Chinese communist party has made a decision to change the industrial structure, adjust the energy structure, reduce the carbon dioxide emission, decrease the proportion of the electricity production from conventional thermal power plants, increase the percentages of the electricity generation from clean and new energy technologies. In the mean time, the Chinese government has proposed the “Global Energy Interconnection” strategy which could potentially achieve long-distance electricity transmission via ultra high voltage AC/DC grids, and thereby increasing the proportion of hydroelectric power and wind energy in the current energy structure. Against this background, the hydroelectric power industry faces a golden opportunity for its development. This paper chooses a public traded hydroelectric company SDIC Power Holdings Co., Ltd. as a study object. Based on the specifi c characteristics of this company, the value evaluation issues are investigated using the value evaluation theory and method, which has a theoretical and realistic significance in the company development and enterprise management decision-making.The objective of this work is to evaluate the value of the SDIC Power Holdings Co., Ltd., using the method of Economic Value Added(EVA).The SDIC Power Holdings Co., Ltd. has been chosen as the main case and its value is evaluated mainly based on the EVA method. The analysis is performed from the following aspects: Chapter 1 as the introduction part, states the research background, significance and main content of this study. Chapter 2 explains the definition of the EVA, merits of the use of the EVA on the evaluation of the enterprise value, and applications of the EVA method in the market of China. Chapter 3 summarises the status of the development of the electricity industry and performs analysis of the hydroelectric power enterprises. Chapter 4 presents the current status of the SDIC Power Holdings Co., Ltd and analyses its financial statements. Chapter 5 obtains the EVA-based enterprise value of the SDIC Power Holdings Co., Ltd., via calculating its historic EVA and predicting the future EVA. The last chapter draws the conclusion and presents the outlook.This paper wants to provide a useful reference for investors through analysing and discussing the EVA value evaluation model.