Case Study On Financial Flexibility Reserve Of Midea Group And Its Enterprise Value Enhancement

With the acceleration of economic globalization,trade between countries has become more frequent,and the international trade situation and economic environment have become more complicated,which has caused great uncertainty to the business environment of enterprises.At the same time,under the influence of the global wave of industrialization,enterprises have chosen to transform and upgrade for long-term development.Under the background of the uncertain external environment of enterprise operation and financial management and the transformation and development of enterprises,financial flexible reserves are increasingly valued by enterprises.In order to effectively respond to external emergencies,enterprises reserve certain financial flexible resources to help improve their ability to cope with uncertainty.Sufficient financial flexible reserves are conducive to coordinating the internal and external resources of enterprises,helping enterprises to rationally arrange cash flow in time and quantity,alleviate corporate capital pressure,optimize enterprise resource allocation,improve risk response capabilities,seize investment opportunities in difficult situations,expand their own scale,and promote the enhancement of enterprise value.Therefore,financial flexibility reserve through typical case studies has important practical significance for enterprise value enhancement.This paper selects Midea Group,a giant company in the home appliance industry,as the case study object,analyzes the financial flexible reserves of Midea Group,and explores the mechanism and effect of its financial flexible reserves on the enhancement of corporate value.The study first expounds the overview of Midea Group’s financial flexible reserves,analyzes the financial flexible reserves of Midea from 2017 to 2021 from three aspects: reserve identification,motivation analysis and horizontal measurement,and on this basis,the financial support analysis of Midea financial flexible reserves from the perspectives of financing capacity and business activities is carried out,and the analysis shows that the group has good financial flexibility acquisition ability,which provides a solid financial guarantee for the stable operation and development of enterprises.Secondly,the mechanism and effect of Midea Group’s financial flexible reserve to enhance corporate value were studied,and EVA indicators were selected to evaluate the improvement effect.The research shows that in its investment activities,Midea Group helps enterprises improve their coping ability by releasing financial flexibility,gain advantages in industry competition,provide financial guarantee for enterprise innovation and research and development and diversified strategy promotion,and form a virtuous circle to continuously help enterprises create value and achieve the management goal of value enhancement.Finally,the research conclusions and relevant implications are drawn.The conclusion shows that Midea Group has a good level of financial flexibility,and its financial flexibility reserve has a promoting effect on enhancing corporate value.At the same time,the relevant enlightenment of other enterprises for financial flexible reserves is extracted,which is expected to bring management reference for the same industry in terms of financial flexible acquisition,corporate liability structure and strategic investment,enterprise asset management and financial flexible supervision mechanism,and also provide certain reference value for new companies in the home appliance industry and other industries in the future.