The Application Research Of Industry Analysis In Business Valuation

Macro analysis,industry analysis and business analysis are three parts of the fundamental analysis which play an important role in business valuation.The value of enterprises is determined by present and future income that is related to the status and development trend of industry,so the industry analysis is important.However,the importance of industry analysis in the practice of business valuation has not been widely recognized and accepted,the research of industry analysis from the perspective of asset appraisal is still in the early stage,and studies of industry analysis in the application of business valuation is few.Therefore,theoretical and empirical research of industry analysis in business valuation should be carried out.Nearly 200 assess instructions from Jul 2013 to Dec 2014 are analyzed in this paper.Based on the industry life cycle and financial analysis theory,I would like to reveal the status,shortage and contributions of industry analysis from the perspective of asset appraisal practice.Furthermore,case study of securities industry will be introduced;advice and solutions will be given to promote the application of industry analysis in business valuation.Through the above research,the shortages of industry analysis in business valuation are revealed which include three parts,similar contents,limited effect and imperfect industry analysis system.Therefore,industry analysis new system based on industry analysis,industry life cycle and industry financial analysis theory is constructed to promote the application of industry analysis in business valuation.