Research On Financial Risk Of Jinshan Company’s High Debt Operation

As the New Power Reform continues to deepen,new energy has gradually become a development trend.Competition in the energy market is becoming increasingly fierce,In the face of a complex and changing domestic and external environment,the power market surplus,the impact of new energy competition,the "two end squeeze" of high coal price and low electricity price,and the "dual control of energy consumption" and other factors play a comprehensive role,resulting in losses in thermal power generation,high debt ratio,and increasingly difficult financial risk management and control.This paper takes the financial risk of Jinshan Co.,Ltd.,a thermal power company listed in Liaoning at the beginning of this century,as the research object.Since the listing of the company,the price of coal and electricity has continued to rise,which has had a huge impact on the operation of the company,resulting in the continuous decline of the company’s profitability.Changes in energy market structure,domestic policy factors,environmental development and emission reduction pressure have made society’s financial risk more serious,how to resolve the financial risks of enterprises and help them to bail out is the top priority for enterprises.The objective of this document is to identify,assess and control its financial risks.First,based on their domestic and international results,financial risk theory and industrial features,TOPSIS is used to analyse the state of financial risk in a case enterprise.Second,the article makes a preliminary identification of the financial risk from four aspects:financing risk,investment risk,operational risk and cash flow risk.And establishes an evaluation system by selection of indicators,and ranks the financial risks.Third,based on the analysis of the company’s financial risk ranking and the change of financial risk over the last 6 years,we find that the financial situation of the company has worsened significantly in recent years,and a comparison with other companies in the same sector indicates a high financial risk.Finally,In combination with the industry’s sociological background and its own situation,It is suggested that the Company should expand its financing channels,optimize its capital structure,enhance its receivables management,and regulate its investment risk management,and set up an early warning system for cash flow risk and other risk management measures in order to support the continued operation and development of the business,in order to provide a basis for helping companies to overcome their financial difficulties.