Case Study On The Financial Performance Of Greentown Group's Asset-light Transformation

Since the reform and opening up,China's real estate industry has made huge profits by relying on the dividends of land appreciation under the asset-heavy model.However,with the development of the industry,the huge profit space no longer exists,the real estate industry began to enter into the age of memory:the land price rising,increased competition in the industry and the national regulation policy of gradually introduced factors makes bank loans as the main financing channels of the disadvantages of traditional heavy assets operation mode is more and more obvious,house prices falling profits.According to the 2017 loan statistics report released by the central bank,the growth rate of bank loans for real estate enterprises has slowed down,which also reflects that the era of the real estate industry to transform asset-light operation mode has started.Different from the traditional asset-heavy mode,asset-light operation mode takes the idea of "leveraging the maximum profit with the least capital" as the concept,which undoubtedly points out a new direction for the real estate enterprises with great financing pressure.Therefore,China's domestic real estate developers have begun to learn from foreign real estate business operation model,asset-light transformation.However,domestic real estate enterprises have been operating in the asset-heavy mode for many years.Can they well transform the asset-light operation mode?If the asset-light operation mode is adopted,can the company's financial indicators really be improved?For real estate enterprises,what are the advantages of the asset-light model,and whether there are some problems?These are many housing enterprises are eager to understand the problem.Therefore,this paper uses literature research method,comparative analysis method and case analysis method to summarize the characteristics of asset-heavy and asset-light models,summarize their respective applicable conditions,and analyze the transformation drivers by combining macro policies,industry development and enterprises' own situation.At the same time this paper select the first in China to implement light asset transformation of enterprise-greentown China holdings co.,LTD.(hereinafter referred to as the "green city"),for example,to the transformation of its asset light model of background and implementation process is analyzed,and its transformation are summarized by analyzing the important report project light assets financial characteristics,and combining with the relevant financial indicators respectively from the angles of the longitudinal and transverse mode of the light assets of financial performance are discussed.Studies have found that light assets mode of greentown China financial performance plays a positive positive significance,but also reduce the profit level,large foreign currency financing for enterprises brings more exchange loss and other problems,so the light asset transformation didn't happen overnight,the light asset transformation of greentown still has a long way to go.Through the research in this paper,it is theoretically hoped that the academia can pay more attention to the asset-light transformation of the real estate industry and further improve the industry's research on asset-light operation mode.In practice,it is expected that the asset-light transformation case of greentown can provide some experience for other real estate enterprises.