Corporation Value Assessment Based On Free Cash Flow

With the rapid development of China marketing economy, increasing improvement of capital market, as an important method of corporation financial management, investment, merger and acquisition, value assessment has been applied frequently. How to assess the value of a corporation is a difficulty of our capital market, also is a hot issue in theory circle. So far, after a long-term research, value assessment theory has formed an integral system, and has been widely used.On that basis, the paper does research on the theory and practice of corporation value assessment, especially discounted free cash flow method. The main content of the paper is as follows:Firstly, discuss the background and significance of researching corporation valuation, summarize relevant literature, point out innovation and insufficient of the article. Secondly, research value assessment theoretically. By analyse and contrast the methods of value assessment, point out the advantage of discounted free cash flow method. Thirdly, explain the theory of discounted free cash flow method detailed, including its defect and improvement assumption. Fourthly, use the improved method to assess the value of Mengniu Dairy. After analysis of macro-environment, industry environment, corporation situation, estimate free cash flow and dynamic WACC as the improved discount rate, the value of Mengniu Dairy can be obtained. The fifth part is conclusion. Confirm the feasibility of discounted free cash flow method and significance of method improvement, offer suggestion of other deficiency existing.