Credit Risk Rating Of Pharmaceutical Enterprises With Multinomial Logistic Regression Model

Confucius said,"People cannot live without credit." Similarly,credit is indispensable for enterprises to exist and even thrive.Credit is reflected in every operating activity of enterprises themselves and every transaction among enterprises.It is not only the basis of smooth business contacts among enterprises,but also the key to ensure the harmonious and orderly operation of the whole market.In recent years,However,in recent years,the frequent occurrence of credit scandals in Chinese enterprises has become the central issue at home and abroad.In many industries in our country,the pharmaceutical industry has been paid much attention because that its development rate is higher than the world average and it is closely related to people's livelihood.However,a series of problems still exist in pharmaceutical industry of our country,such as the large number of enterprises,irregular internal management and fluctuating social reputation,which will not only affect the development of enterprises themselves and the pharmaceutical industry as a whole,but also hinder financial institutions from making correct credit decisions for pharmaceutical industry enterprises to a certain extent.Generally speaking,there is no unified,comprehensive and effective system to evaluate credit risk of pharmaceutical enterprises in our country.On the basis of previous studies,this paper attempts to objectively identify and evaluate the credit risk of the pharmaceutical companies studied,so as to give them credit rating.This paper chooses the relevant financial data of 267 companies listed in the pharmaceutical industry at the end of 2017,and adds a market environment factors based on public opinion and industry characteristics.Firstly,the classical Z-score model is used to make a preliminary score,which lays a foundation for enterprise classification in the latter model.Then,principal component analysis is used to reduce the dimension of independent variables and Fisher discriminant is used to verify market environment factors.The introduction of sub-models will reduce the rate of misjudgement.Finally,a multi-logistic model is used to evaluate the credit of sample enterprises.It can help enterprises to realize their own shortcomings in operation and promote their sustainable,healthy and rapid development.At the same time,it also provides a reliable basis for banks and other financial intermediaries to provide relevant financial services to these enterprises.