Study On Application Of Jinchuang Group Limited IPO Pricing Model

Jinchuan Group Co., Ltd. (hereinafter referred to Jinchuan Co.) listing imminent, the reasonable price that the stocks of Jinchuan Co. can be traded in the first and secondary market is the issue that the investors concern.Whether Jinchuan Co. IPO can be accurate priced depends on a reasonable valuation model and accurately estimating those parameters of the model.The significance of the study on the application of Jinchuan company IPO valuation model lies in its helpful to companies, institutional investors, and individual investors more convenient to understand the core of the value of the company.After analysing the significance of Jinchuan Co. listing, use the modern investment theory, a number of major research results that based on the modern investment theory has been made in this paper.First is the selection of the model of Jinchuan Company IPO pricing. We introduced four alternative models including discount model, the relative valuation model, and the valuation of natural resource-based companies model.Second is the analysis of the conditions under which these models are used.After researching for nearly 30 listed companies's financial data in the non-ferrous metal industry and using a statistical analysis, we calculated the risk value and the discount rate of Jinchuan Company.As the generic IPO pricing modle used in China's stock market is the price-earnings ratio multiple methods, in this paper we used the SPSS software to analyse the linear regression relation between the price-earnings ratio of 26 listed companies in non-ferrous metals industry and those companies's finacial date, and established the multivariate linear regression model of the earnings ratio of listed companies in non-ferrous metals industry.Combined the result of this paper with Jinchuan company's financial data ,we can roughly estimate the reasonable price of its IPO.Prior to the Jinchuan Co. is listed, the results of this paper supply a platform for investors to understand the investment value of Jinchuan company, also made the preparatory work for its IPO prcing.