The ZSH Enterprise Value Evaluation Research

The state-owned enterprises plays an important role in the China’s economic development, not only affects the trend of national economy, also relates to countless state workers and social stability. Under the background of economic recession, how to revitalize the state-owned assets is an important issue concerned by the decision-makers and the social people. The eighteenth party meetings proposed comprehensively deepen the reform of state-owned enterprises, and actively develop the mixed ownership economy to strengthen state-owned enterprises, which inevitably involves the transfer of state-owned assets, restructuring and acquisition activity, and the enterprise value assessment is one of the important link of the trading activities. From regulatory departments as the Treasury Department and the SASAC of the implementation of the measures for the administration of view, the state-owned assets assessment method and value concept are still relatively backward, and in practical application assets evaluation in China is still use the "net assets", "net profit" and other accounting measure as the main evaluation benchmark, and the financial statements of revenues, profits, net assets accounting indexes would be easily affected by accounting policy adjustment and choice of accounting methods.And the influence of these factors may make the assessment result deviating from the enterprise’s intrisic value and go against making scientific and effective decision-making of investors. Therefore, how to select the applicable scientific and effective evaluation methods of enterprise value evaluation has become increasingly important realistic problem.Based on ZSH enterprises as the research object, this paper mainly uses research methods such as the case analysis, model analysis and literature research to solve the problem. Firstly in this paper, we introduce background and the enterprise value evaluation of relevant theory and research results. Secondly we analysis current situation of the valuation of ZSH enterprises which cannot get reasonable assessed results under the traditional valuation method, thus we conclude the problems that to evaluate the enterprises value under the traditional valuation method,then combining with the characteristics of enterprise management and the applicability of various assessment methods, we think that the method of Free Cash Flow can be well used as the final assessment method. In order to get the ZSH enterprise development trend of free cash flow in the forecast period,we analysis the industry, SWOT and financial indexs in this article and use two stages to evaluate ZSH enterprise value, and analyzes the evaluation results verify. We get the following conclusion that the value evaluation results of free cash flow method to evaluate the ZSH got close to actual transaction prices of enterprise value evaluation results thus we confirm the law value evaluation feasibility and advantages of the application of state-owned enterprises,finaly summarize the key points that should be paid attention to in the application process.In this paper, we used the method of Free Cash Flow to assess ZSH enterprise value,which provides scientific and objective reference basis. This article suggests that we should promote the application of the method and propose some suggestions for further improvement and completion of the state-owned enterprise evaluation.