Digital Transformation And Enterprise Market Value

Digital economy is an important part of the current global economic development,it rises with the rapid development of information technology,has become the foundation of modernization transformation.In the digital economy,the rapid development of the new generation of digital technologies is increasingly profoundly affecting the traditional industries,promoting the digital transformation and intelligent upgrading of the traditional industries,and accelerating the pace of industrial structure upgrading and transformation upgrading.Manufacturing industry is an important pillar of the national economy and the main body of the industrial system including a variety of traditional industries.Although China’s traditional industries have a large scale and created a large number of profits,taxes and jobs,the traditional industries still face many problems in the process of development,such as low efficiency and large consumption of resources,especially the need to transform and upgrade to change the situation.This article primarily aims to investigate how digital transformation has affected the market value of manufacturing enterprises that are publicly listed on the A-share market during the period spanning from 2007 to 2020.Through the utilization of text analysis methodologies,the study endeavors to acquire relevant data on digital transformation and evaluate how it has influenced the market valuation of these firms.Firstly,the relevant literature on digital transformation and enterprise market value is reviewed to lay a theoretical foundation for subsequent research.Secondly,human capital level,corporate governance level,and analyst attention are selected as mediating variables for theoretical analysis,in-depth exploration of their mediating role between digital transformation and enterprise market value,and corresponding hypotheses are proposed.Robustness tests are performed based on benchmark regression,including replacing explanatory variables,replacing explained variables,eliminating the impact of strategic behavior,and other methods.Two instrumental variables are also selected to perform endogeneity tests to ensure the reliability of the results.Considering that enterprise digital transformation may be influenced by various factors,heterogeneity analysis is conducted based on property rights,enterprise lifecycle,and relative size,the entire sample of enterprises is further analyzed to assess the influence of digital transformation on their market value,as well as to examine the spill-over effects of this transformation.The results of this study first show that digital transformation can greatly improve the market value of manufacturing firms,and the results can be seen through both rational and internal research.Secondly,regarding property rights,digital transformation has the potential to increase the market value of both state-owned and non-state-owned enterprises,but the impact is expected to be more substantial for state-owned enterprises.According to the enterprise lifecycle model,digital transformation can have a substantial impact on increasing the market value of manufacturing companies in the growth and decline stages.However,it does not seem to have a significant effect on companies in the growth stage.Digital transformation can have a greater impact on enhancing the market value of small and medium-sized enterprises,while its effect on large-scale enterprises is relatively smaller in terms of relative enterprise size.The pathway mechanism indicates that the application of digital transformation within the manufacturing sector can enhance the market value of enterprises by boosting their human capital and corporate governance levels,as well as attracting more attention from analysts.Additionally,the degree of marketization plays a moderating role in this process.Further examination reveals that digital transformation can enhance the market value of various types of enterprises,including those in the manufacturing and service sectors.Moreover,there are spillover effects of digital transformation within specific industries and regions,which can impact the market value of manufacturing enterprises.Based on the above conclusions,this thesis puts forward the following countermeasures and suggestions: First,enterprises should carry out targeted digital transformation.Before digital transformation,they should understand the needs of the market and customers so as to formulate corresponding transformation plans.Second,enhance the depth of application of digital transformation,embed digital technology into the workplace,production process and other links,broaden the vision of digital transformation,achieve multi-level upgrading.Thirdly,we should pay attention to the cultivation and introduction of digital talents,establish a security system for digital talents,and avoid the loss of vigorously cultivated digital talents as far as possible.Fourth,optimize the internal management structure,improve the enterprise governance ability and the ability of enterprise managers,so as to make the digital transformation smoother.Fifth,the government should introduce a series of incentive policies,such as tax incentives and science and technology innovation funds,to encourage enterprises to actively invest in digital transformation.