The Influence Of Central Enterprises' Combination Of Industry And Finance On Enterprise Performance

The combination of industry and finance is the product of the development of social economy and the integration of real economy and financial economy.Therefore,large enterprises at home and abroad have expanded their capital through the combination of industry and finance,extend their business scope and further promote the rapid development of enterprises with the strong competitiveness.In order to improve the competitiveness and implement the strategy of globalization,the combination of industry and finance is the inevitable choice of central enterprises in China.However,the combination of industry and finance is also a double-edged sword,enterprises obtain huge profits in the rapid expansion of scale will also produce operational risks and generate negative effects for its sound development.Central enterprises are the main force of China's domestic financial integration,but also the pillar of the national economy,which decides the central enterprises needed to grasp the positive effects of the combination of production and finance and avoid potential risks.Therefore,the combination of industry and finance on the performance of central enterprises is more worthy of discussion.As the forerunner of the combination of production and finance,it is necessary to make a deep research on State Grid,which can be used for reference by other enterprises in China.This paper expounds the present situation,mode and characteristics of the combination of production and finance in central enterprises,analyzes its advantages and disadvantages to the formation of central enterprises,and selects State Grid as a research case.This paper not only analyzes the positive and negative effects of the combination of production and finance on enterprise performance from the theoretical level,but also verifies the effect of the combination of production and finance of State Grid on enterprise performance from the perspective of the profitability,asset quality,debt risk,operating growth and EVA.Through case analysis,this paper draws the following conclusions:(1)The combination of industry and finance brings both positive and negative effects to the central enterprises;(2)The combination of industry and finance brings huge profits to State Grid,and also generates capital integration risks and the shortage of cash flow;(3)The positive effect of the combination of industry and finance on enterprise performance is much higher than that of negative effect.This paper puts forward the following suggestions:(1)Focus on the development of combination of industry and finance and formulate corresponding strategy;(2)Enterprises involved in the combination of industry and finance should establish the risk management and control system;(3)Enterprises that implement combination of industry and finance should pay attention to the synergy effect of it;(4)Strengthen supervision of internal and external combination of industry and finance,and pay attention to the management and cultivation of financial talents.The main contributions of this paper are as follows:In theory,this paper explores the impact of the combination of production and finance on enterprise performance from the perspective of financial management,and analyzes it from the micro level of State Grid,which enriches the application of the combination of industry and finance at the micro level.In practice,this paper tests the influence of the combination of production and finance on enterprise performance through theoretical analysis and index test,and more intuitively reflects the successful experience and existing problems of the combination of production and finance in State Grid,so as to provide a better reference for other enterprises.