Research On The Improvement Of Yangtze River Power Value Assessment Based On FCFF

Under the wave of electric power reform,electric power enterprises continue to improve their operating efficiency,seek their own competitive advantage,and carry out a series of capital M & A activities.Investors’ eyes are also focused on this.How to determine the value of electric power enterprises has become a proble m in theory and practice.In China,FCFF(free cash flow model)is the most mature and widely used valuation method,which believes that the future free cash flow determines the enterprise value.How to accurately predict the free cash flow of an enterpris e plays a key role in the accuracy of FCFF model evaluation.At present,there are many prediction methods about free cash flow,but the commonly used are proportion prediction,BP neural network prediction and regression analysis prediction.These methods have certain adaptability for enterprises with more historical data and linear data laws,but they do not solve the problems with less historical data s,many influencing factors and nonlinear data questions.The grey prediction model in the grey theory can effectively make up for this gap.In order to accurately evaluate the value of Yangtze River power,this paper analyzes the applicability of traditional value evaluation methods and profit prediction methods in Yangtze River power,studies the whole value evaluation process of Yangtze River power,finds out the possibility of the application of grey prediction model in the value evaluation of Yangtze River power,and improves the FCFF model’s free cash flow prediction by using grey prediction model A reasonable conclusion.In this paper,the grey prediction model is introduced into the free cash flow prediction,which provides a quantitative analysis method for investors.At the same time,the improved FCFF model can provide reference for other evaluation work and practical research of value evaluation.