Finance Strategy And Organization Advancement Research On Nanjing Urban Construction Investment Holding Group

Nanjing Urban Construction Investment Holding Group is one of the three corporations which are responsible for the construction investment and financing with the authorization of Nanjing Municipal Government. The Group undertakes the investment, construction, operation, and management of the urban infrastructure and public utilities. With changes of the environment such as the strengthening of the macro-control and the direction adjustment of the credit industry, the inner conflicts which has never showed but existed is more and more obvious in the area of the finance mechanism, the organization structure and the inner-controlling mechanism. These factors have directly harmed the financing ability of the Group.This paper points out the threats that Nanjing Urban Construction Group faces by analyzing the present situation of the Group. Through researching the theories related to project finance and corporate finance, group organization structure design and corporate governance and so on, this paper puts up some pertinent advices to advance the financing mechanism and the structure of the Group.This paper includes six chapters. The structure is as follows: The first part is the preface which introduces the background, the meaning and the purposes of this research. The second part analyses the present situation of the Group and points out the harmful factors which confines the Group to finance. The third part cites and studies on the related theoretical knowledge. The forth part designs the finance mechanism based the mission of the Group. The fifth part brings forward some suggestions on the related issue of organization structure advancement that concerns finance mechanism. The sixth part designs the inner-controlling policy of the Group.The conclusions and innovations of this paper are as follows:1,Thinking of the well-being and mercantile characteristic of the business of Nanjing Urban Construction Investment Holding Group, and depending on the separate operation of its projects, this paper figures out how to make a reasonable strategy plan of its financing for the company or for one project, and plan as a whole to settle this difficulty that how tobalance the sustaining development of itself while realize the projects of the government.2,Building up the restricted mechanism of investment for the well-being projects, which regards the"sinking fund"as the resource for payment, in this way to control the risk of excessive investment. It offers a mechanism of safeguard, which can help the Group to formally refuse the government's well-being projects.3,This paper discusses about how to relieve the financing risk inside of the group by financing with the approach of projects, it means that using BOT model to finance for some projects what can satisfy the basic profit level, and make all of or most of the project'risk stay in its subsidiary company establishing for the project. Transfer the directly financing or investment model of the group, then decrease the capital debt rate in the balance sheet of the group.4,This paper designs subsidiary organizations which undertakes financing and investing of the well-being projects specially in the organization structure design. By this way, the pressure and risk of financing of the Group can be transferred and make the separation of the financing risk come true. It also can avoid the harm arosing by the excessive investment of the well-being projects to the mercantile subsidiaries.In the process of rapid urbanization, Municipal Government at every levels founded urban asset-operating corporations one after another in order to break the limit of the budget of balance. The debt of these corporations can break the limit of the budget, and just for this reason, the debt of enterprises replaces the debt of the finance of Government. The excessive investment on the well-being projects has harmed the continuable development of the urban asset-operating corporations for the weakness of the investment restriction of Government. Based the partition of projects and sinking fund, this paper builds one mode in which the operating and the financing of the well-being projects and the mercantile projects are separated In the same time, this paper designs three-level organization structure of the Group including the headquarters of the Group, the professional subsidiary corporations differentiating by the type of the industry and the functional department of the Group and the operating corporations. This design considers the real wants of controlling the risk of financing and heightening the level of the management of the assets. The conclusions of this study are universal for urban asset-operating corporations.