Applicability Of Value Evaluation Methods For Listed Companies In Chinese Medicine Industry

With the rapid development of China's national economy,the status of the Chinese medicine industry in the market economy has become increasingly important.In recent years,under the background of the big health industry,the continuous introduction of new medical reform policies has accelerated the cycle of the entire Chinese medicine industry and promoted the transformation and integration of the sub-sectors.In the meantime,the country began to support the cultivation of traditional Chinese medicine.Under the concept of big health and the continuous innovation of information technology,traditional Chinese medicine enterprises are bound to seize opportunities and accelerate their industrial layout.Therefore,the development of the entire Chinese medicine industry is particularly important.The Chinese medicine industry is a branch of the pharmaceutical industry,but Chinese medicine companies are different from the general pharmaceutical companies,which are embodied in specialties and the technological advantages of the inheritance.Presently,under the support of national policies,many established Chinese medicine companies have responded to the development trend and made strategic transformations,constantly expanding their business segments,and their business performance has also increased correspondingly with the transformation of the strategy.The valuation of the old brand Chinese medicine companies in the academic and investment environment practices is still inconclusive.Zhangzhou PIEN TZE HUANG Pharmaceutical Co.,Ltd.(hereinafter referred to as PIEN TZE HUANG)is a representative of such enterprises.Therefore,this paper takes it as a object and uses several valuation methods widely used in practice to evaluate the values separately.The applicability of Chinese medicine enterprises provides a case reference for the value evaluation system of Chinese medicine enterprises.Based on the research on the applicability of academic models,this paper selects the typical income method and market method for specific case analysis.According to the "industry status-company fundamental analysis-the calculation of the value evaluation method model-the applicability conclusion of the method",the main line is progressive.Firstly,the PEST method is used to analyze the macro environment of the Chinese medicine industry,and the competition situation of the Chinese medicine industry is analyzed through the five-force model.Then,the industry data is compared,and the historical data of PIEN TZE HUANG is analyzed in details,and the SWOT method is adopted.The development characteristics of the enterprise are analyzed.The analysis results of the industry and enterprise are integrated.The free cash flow discount model and the EVA model under the income method and the price-earnings ratio model under the market method are used to calculate the enterprise value of PIEN TZE HUANG.Based on the comparison of the valuation results with the stock price,the conclusions of the final applicability are obtained by comparing the estimation processes under different models.The research shows that for the Chinese medicine enterprises with unique products and huge market potential in the future,the free cash flow discount model and the EVA model under the income method are closer to the price per share,and the valuation of the P/E model,tends to underestimate its intrinsic value.