The Research On The Financial Drivers Of Value Creation In Guizhou Maotai Company

Value creation is an important indicator for analyzing and evaluating the market competitiveness of the enterprise.It is the final purpose of enterprise.The performance of competitiveness is the continuous increase of enterprise value.How to ensure the continuous growth of value and identify the essential drivers of value growth,and establish a system of value growth is the focus of corporate managers.Therefore,studying the value creation drivers of enterprises is always a hot topic in the academic circles and management circles.This article obtains from the issue of enterprise value and be based on the theory of value measurement and the theory of economic value added,.we analyzed the value creation of Guizhou Maotai from 2008 to 2017 years.Through analyzing the profitability index,the total returl on assets(ROA)and the return on equity(ROE),we conclude that Guizhou Maotai has a high level of profit,its ROA and ROE indicators were much higher than the industry average and the upper quartile;then we analyzed the economic value added indicators and Compared with the industry data,we found that Guizhou Maotai not only created a large amount of value,but also had a higher efficiency of value creation.Finally,through the analysis of market value-added indicators,we found that the Guizhou Maotai had a excellent performed in marketl.Therefore,in terms of comprehensive profitability,total value creation,efficiency of creation and market performance,we can conclude that Guizhou Maotai has outstanding value creation capabilities.Subsequently,based on the financial perspective,we quoted the financial driven model of value creation proposed by Alfred Rappaport,the father of shareholder value in the United States.we explored the financial drivers of Guizhou Maotai value creation.from working capital management activities,investment management activities,financing management activities,and company value durations.Through comparison with industry data,we find that sales growth rate,operating gross profit margin,working capital investment,fixed asset investment,and equity capital compared have obvious advantages compare with the industry.Therefore,we consider that the above financial driver is the key drivers of Maotai’s value creation.Besides,the income tax rate,debt capital and capital structure have no obvious advantages compared with the industry,so we regard they as the general driving factors in the value creation process of Guizhou Maotai.Finally,this paper puts forward reasonable suggestions based on the financial management activities of enterprises on how to use the key financial drivers to create more free cash flow for enterprises,reduce the weighted average cost of capital,and extend the value creation period to create value for enterprises.