Application Research Of EVA Valuation Model In Pharmaceutical Enterprises

With the continuous development of China’s economy,the living standards of residents have been continuously improved,and people’s health awareness has been continuously enhanced.The pharmaceutical industry in China has continued to grow.At the same time,as a strategic emerging industry in China,the pharmaceutical industry has received strong support from national policies.Under this circumstance,China’s pharmaceutical industry has developed at a rapid pace.For a long time,the pharmaceutical industry has attracted the attention of many investors.Under this circumstance,it is particularly important to make a rational valuation of pharmaceutical companies.A reasonable assessment of the value of pharmaceutical companies will not only help investors make investment decisions,but also improve the company’s own operations and management.The enterprises in the pharmaceutical industry generally exhibit high R&D investment,high technical threshold,and high return rate.China currently does not have a method for value evaluation of pharmaceutical companies.The traditional method of corporate value assessment cannot highlight the characteristics of pharmaceutical companies.Therefore,this paper aims to explore the methods that are more suitable for value assessment of pharmaceutical companies.In the assessment process,EVA valuation model can take into account the characteristics of the company and the industry,so as to adjust a part of the accounting subjects,making the assessment results more realistic.This paper will take Shijiazhuang Yiling Pharmaceutical Co.,Ltd.as a case to study the application of EVA valuation model in general pharmaceutical enterprises(non-state-owned).On the basis of consulting related literature,this paper uses the methods of comparative analysis,combining theoretical research and case analysis to study the application of EVA valuation model in general pharmaceutical enterprises in China.First of all,this paper gives a brief introduction to the method of traditional enterprise value evaluation and EVA valuation model.Combining the characteristics of China’s pharmaceutical industry,this paper analyzes the particularity of the value assessment of pharmaceutical companies,to illustrate that traditional enterprise valuation methods have some deficiencies in the value assessment of pharmaceutical enterprises.And point out the applicability and advantages of the EVA valuation model in view of the valuation of pharmaceutical companies.Then,taking Yiling Pharmaceutical as a case,through the analysis of Yiling Pharmaceutical’s operating conditions in the past five years,combineing with the company’s external environment,an appropriate EVA valuation model was constructed.Finally,during the assessment process,the EVA values of YiLing Pharmaceutical in the past five years were calculated separately.Combining the current status of enterprise development with the external environment,made a pre-judgment on the future prospects of the company.Based on the EVA valuation model that has been constructed,make a reasonable assessment of Yi Ling Pharmaceutical.Then compare the market value of the company at the time to analyze the assessment results.Through the research of this thesis,it is concluded that the EVA valuation model is suitable for the value assessment of general pharmaceutical enterprises in China.And compareing with the traditional enterprise value evaluation methods,it has certain advantages.Secondly,the assessment results have a certain enlightening effect on the managerial staff of Yiling Pharmaceutical,and it also provides decision-making reference for potential investors of the company in the stock market.In this paper,the analysis of the valuation process of Yi Ling Pharmaceutical Company also provides reference for the value evaluation of other similar companies.