A Study On The Motivation And Financial Performance Of Lifestyle China

For a long time,many companies have realized capital expansion by means of capital operation such as acquisition,merger,share-holding and so on.However,these expansive reorganization methods bring advantages to enterprises,but also bring a series of problems that need to be solved urgently.After long-term exploration,scholars at home and abroad have found that the shrinking capital operation mode can not only meet the requirements of broadening financing channels,but also improve the dilemma of undervalued enterprise value.In recent years,the mode of split listing has been unanimously recognized by many enterprises and has been widely used.This study takes Lifestyle China Group Co.,Ltd.as an example,and uses relevant research theories and practices at home and abroad for reference,deeply excavates the motivation of Lifestyle China's split listing,and calculates and analyses the impact of split listing on Lifestyle China and Lifestyle international financial performance by means of multiple financial ratios.At the same time,with the help of DuPont analysis method,this paper compares the financial data of Lifestyle China with that of other enterprises in the same industry,in order to reflect the changes of Lifestyle China's position in the same industry before and after its split and listing.Finally,the paper summarizes the existing problems of Lifestyle China's financial performance after the split listing and puts forward corresponding countermeasures and suggestions.The results show that,for Lifestyle China,the split listing generally promotes the company's solvency and profitability;the company's operating capacity decreases after the split listing;the split listing does not have a significant impact on the company's growth capacity;a large amount of equity financing meets the needs of operation and investment activities.The comparative analysis of the same industry by DuPont analysis shows that although the market environment is not ideal in2016,the financial performance of Lifestyle China is still higher than the average level of the same industry.Even if there are individual financial ratios falling,the decline is far below the average level of the same industry.Therefore,although the economic situation is not good,the contribution of split listing to Lifestyle China is still very significant.This paper sums up three major problems in Lifestyle China's financial performance: low inventory turnover,low accounts receivableturnover and low utilization of financial leverage,and puts forward five targeted suggestions.Not all companies are suitable for spin-off listing.Generally speaking,most of the companies that choose to split and list are diversified and decentralized.They must have good profitability and stable operating cash flow to offset the negative effects of splitting up high-quality assets,and the possibility of successful splitting and listing abroad will be higher.This paper strives to enrich the theory of split listing,hoping to provide reference for the refinancing and further development of the same industry enterprises,and then to promote the healthy development of China's split listing.