Research On Financial Strategy Of Supply Side Reform Practice Of WISCO Group

With the gradual slowdown of economic growth,China's economy has entered a new normal,from the previous "speed-scale extensive growth" to the "efficiency-quality intensive growth",the source of power is also driven by "factor investment" Turn to "innovation drive." In the face of the arrival of the new economic normal,"reform" is nothing more than the most powerful and effective alternative and the only way to achieve economic transformation and upgrading.In reviewing the situation,General Secretary Xi Jinping put forward the "supply-side structural reform" at the eleventh meeting of the Central Financial and Economic Leading Group.It not only pointed out the direction for the development of China's economy,but also made the backbone of China's economic development-the steel industry clear.The goal of reform.As a pillar industry of the national economy,the steel industry has experienced a burst of growth in the early days of reform and opening up.Urban construction,railways,and construction of factories all require a large amount of steel support.The large-scale expansion of steel production scale has provided a splendid development history for the steel industry while providing infrastructure construction guarantee for the development of various industries.However,after the glory,the large-scale production of iron and steel enterprises led to overcapacity in the market,problems such as unsalable inventory,high cost,and long-term debt management within the enterprise;this not only affected the healthy development of the steel enterprises themselves,but also affected the whole The industry and the industry are involved in the effective operation of upstream and downstream.At present,most of the research on the supply-side reform focuses on the macroeconomic situation and the development of the industry.There are still few scholars who study the supply-side reform from a micro perspective.In particular,traditional industries such as steel and coal,which have long been facing backward overcapacity,have focused on the industry's supply-side reforms,and have paid more attention to research on capacity reduction.Based on the microscopic perspective,this paper first analyzes the operation status of WISCO Group before the supply side reform,including the inventory status,capacity status,debt status,and profit status.Based on this,it analyzes the supply side reform of WISCO Group.The necessity and feasibility of the paper;followed by a summary of the financial strategy adopted by WISCO to implement the supply-side reform task requirements,including the optimized resource allocation strategy for mitigating capacity,and the supply-and-sale linkage operationstrategy to alleviate inventory backlogs.Diversified financing strategy to reduce debt pressure,comprehensive cost control strategy to reduce cost and high-pressure point investment,and re-R&D investment strategy to improve supply quality;then supply-side reform of WISCO Group based on supply-side reform financial evaluation indicators mentioned in the reference The practical effects were evaluated.Finally,the quotations and shortcomings of the supply-side reform practice of WISCO Group were summarized.The corresponding improvement suggestions were put forward for the shortcomings,and the conclusions and enlightenments were drawn.The study found that the reform measures adopted by WISCO in recent years have achieved certain results.In terms of capacity reduction,WISCO Group optimized resource allocation through asset divestiture and diversified operations,reduced investment in inefficient production capacity,thereby eliminating inefficient production capacity;and reorganizing with Baosteel Group to integrate homogeneous products and reduce Excess capacity due to repeated production.In terms of inventory management,WISCO Group reduced its inventory of ending stocks by “selling production by sales”,reducing the backlog of inventory at the end of the period;in addition,the company also invested in coastal bases to expand the product sales market and increase overseas sales.In terms of debt reduction,it has cooperated with a number of banks to implement market-based debt-to-equity swaps and establish industrial funds to reduce leverage and obtain transitional funding.In terms of cost control,WISCO Group has formulated relevant cost control strategies from its own high-cost points: labor cost,logistics cost,and management cost,in order to achieve the goal of reducing the cost of enterprises in an all-round way.In terms of improving supply quality,WISCO Group invested heavily in R&D activities,providing financial support for upgrading production technology and increasing high-end supply.Together with the merger of two companies can share superior technologies and jointly develop new products.It has positive significance for increasing the effective supply in the market.