Study On Diversification Strategy Selection Of Agricultural Listed Companies Based On Financial Perspective

Since ancient times,agriculture has been the most basic and important industry in the development of the national economy.With the continuous development of the economy and society,people's diet structure has also undergone major changes.The proportion of meat products in people's total diet has been rising.The traditional feeding methods of animal husbandry have low yields,and they are gradually unable to satisfy people's daily lives.The demand for products.Therefore,as an animal's ingredients,the feed industry came into being.China's feed industry started in the late1970 s and flourished in the mid-1980 s.In 1991,total feed production reached 35.7million tons,making it the second largest feed producer after the United States.In2012,China's total feed production reached a record high of 194 million tons,accounting for more than 20% of the world's total feed production.The feed industry has become the industry with the highest degree of industrialization in China's agriculture.However,with the vigorous development of China's feed industry,a large number of enterprises have invested in the army of feed production.By 2006,the number of feed enterprises in the country reached 15,501.As the market competition intensified,the industry's profit rate began to decline,and the profit of feed enterprises.Capacity and development capacity have gradually declined,and a large number of enterprises have lost bankruptcy in the fierce market competition.As of2015,the national feed enterprises have decreased to 6,772.Why do some companies can stand up against the trend in an invincible market competition,while some companies are bankrupt in market competition? Among them,the diversification strategy,as a business strategy,has won the favor of many companies.However,some of the companies that adopt the diversification strategy are still eliminated by the market,and some have been successful.So,can the diversification strategy really improve the value of the company? A series of studies have been carried out by scholars around this issue,and a large number of research results have been obtained,mainly focusing on the concepts,dimensions,causes,choices and results of the diversification strategy.However,in many studies on diversification strategies,the internal mechanism between the choice of diversification strategy and corporate value mostly stays at the level of qualitative judgment or indicator relationship,while theresearch on diversification strategy selection of agricultural enterprises is even less.There are few.This paper adopts the method of normative analysis,through reviewing the scholars' research literature on diversification strategy,sorting out relevant literatures,and then expounding the theoretical basis of diversified strategic choices,starting from the financial goal of maximizing corporate value and using finance.The indicators analyze the reasons and conditions of the diversified strategy selection,and then use the quantitative analysis model to integrate the diversified strategic selection indicators in the strategic management: relevance and attractiveness,comprehensive analysis and judgment of the enterprise when making diversified strategic choices Whether the alternative industry can contribute to the enterprise's gross profit,whether it is beneficial to enhance the enterprise value in the long run,in order to determine the diversified strategic industry choice of the enterprise.Finally,this paper takes the new Hope Company,a leading enterprise in the feed industry,as the case study object,and analyzes the diversified development history and basic financial situation of the company,and then uses this quantitative analysis model to simulate and predict the industry selected by its diversified strategy.Analysis,and finally use the actual data of the new hope company to verify the predicted value.This paper mainly combines the financial perspective with diversification strategy,and then analyses the representative case company of feed enterprises-New Hope Company.Finally,the following conclusions are drawn: when the profitability of enterprises begins to decline,the solvency is better and the development ability is limited,diversification strategy should be chosen;when enterprises choose diversification strategy,they should satisfy the following conditions for the choice of new industry: the gross profit of the unit product of the industry is positive,and in the long run,the fixed cost of the new industry can be deducted,while in the long run,the fixed cost of the new industry can be deducted.Moreover,the return on investment of new industries is greater than the risk-free rate of return,so the choice of diversification strategy is conducive to the realization of the goal of maximizing enterprise value.After the implementation of diversification strategy,the evaluation of enterprises shows that since enterprises aim at maximizing enterprise value,the profitability,solvency and development ability of enterprises after diversification are realized.Whether the relevant financial indicators are improved correspondingly canbe used as an important evaluation basis for the diversification strategy of enterprises;secondly,the market value of companies as the most intuitive embodiment of the value of listed companies can also be used as a reference basis for evaluating the diversification strategy of enterprises,and ultimately,through the above indicators to comprehensively judge the gains and losses of enterprises in implementing diversification strategy.