Research On Financial Risk Of Kangzhi Pharmaceutical’s Diversified Operation

The fierce industrial competition environment makes many pharmaceutical enterprises face serious business risks.Engaging in a single business cannot disperse the risks of the entire industry,nor can it bring new profit growth points for enterprises.Therefore,many pharmaceutical enterprises begin to expand into new areas by adopting diversified business methods,so as to expand their business scale and disperse business risks.However,the results of diversification are different for different enterprises.Although the implementation of diversification can inject new vitality into the development of enterprises,it is undeniable that if enterprises lack control over risks in the implementation of diversification,the financial situation of enterprises will become worse,or even fall into financial difficulties and can not escape.From this,it can be seen that it is necessary to study the financial risks in diversification.The business segment of Kangzhi Pharmaceutical involves many fields such as pharmaceutical manufacturing,infant and child care,medical services and medical device manufacturing.Until 2017,it has been focusing on the production of children’s drugs.However,this single business model is no longer suitable for the current competitive environment of the pharmaceutical industry,so enterprises began to choose a diversified approach to deal with business risks.With the increasing number of diversified business segments of Kangzhi Pharmaceutical,The degree of correlation between the expanded plate and the main business is getting lower and lower,and the financial risk in the expansion is getting bigger and bigger.Once an enterprise makes a wrong decision,it may face huge risks.Therefore,this paper takes Kangzhi Pharmaceutical as the research object,explains the basic situation and diversification of the enterprise,and analyzes the current situation of financial risk management.On this basis,by comparing the financial indicators before and after the diversification of the enterprise and analyzing the impact of each sector on the overall financial risk of the enterprise,comprehensively evaluate the financial risk faced by the enterprise,find out the causes of financial risk in the diversification,and put forward reasonable suggestions for its control of financial risk.I hope this study can help Kangzhi Pharmaceutical reduce the financial risk in the process of diversification,make full use of the advantages of diversification,and promote the sustainable development of enterprises.