A Study On The Valuation Of Private Equity Investment Projects

With the continuous expansion of the scale and number of investment and financing of private equity investment in the biomedical industry,how to reasonably give a reasonable valuation to biomedical enterprises has become the key,which determines the return on investment of private equity institutions in the biomedical industry,and is also an important basis for private equity institutions’ investment decisions and exit decisions.However,traditional valuation methods cannot comprehensively consider the value of growth,operational flexibility and shareholder choice of biomedical enterprises,and it is easy to ignore the important impact of nonfinancial factors on corporate value.This paper aims to explore the reasonable valuation of biomedical enterprises,combine the mutation progression method,FCFF method and real option method to value them,and take Sirnaomics as an example to study the valuation of biomedical enterprises,which is conducive to giving full play to the role of private equity investment in promoting the industry,and also conducive to promoting the healthy development of investment and financing in the biomedical industry.By introducing Dachen Financial Intelligence Private Equity and analyzing Sirnaomics’ company profile,financial situation and core competitiveness,it is found that the growth,risk and non-financial value of biomedical enterprises are difficult to price and value.In view of this valuation difficulty,this paper uses the mutation progression-FCFF-BS method as the valuation method of biomedical enterprises,takes the above factors into account and applies it to Sirnaomics’ valuation example,and obtains that the intrinsic value of Sirnaomics is 3.271 billion yuan.Comparing the valuation results with Sirnaomics’ current market capitalization,price-to-book ratio valuation and free cash flow valuation,it is found that the use of the price-to-book ratio overestimates Sirnaomics’ market value,and the use of the free cash flow method is prone to undervaluation of Sirnaomics,and the current market undervalues Sirnaomics.Then,based on the valuation results,this paper argues that private equity investment institutions should attach importance to the non-financial value of enterprises,and proposes that private equity investment institutions should help enterprises enhance the value of invested companies by improving corporate management and core technologies.Finally,through the valuation example of Sirnaomics,it is found that the model constructed in this paper is suitable for the valuation of high-tech enterprises with strong industry,stage and growth.