Evaluation Of Game Enterprise Value Based On DCF And B-S Option Pricing Model

Since the 21 st century,the world’s game industry has developed rapidly.From the previous game console card game to the current online game,the game form and carrier have made great progress.While the game industry has undergone earth shaking changes,the game audience has also expanded rapidly.With the rapid development of the Internet and smart phones,the game industry plays an increasingly important role in the modern economy.The game industry is different from the traditional industry.The game industry has the characteristics of high risk,large investment,high return and large fluctuation.With the continuous development of the game industry,the number and volume of enterprises in the industry are expanding,and there are also many problems.China’s game industry started late and belongs to a sunrise industry in China.Many enterprises in the industry have a short establishment time,unstable cash flow and serious product homogenization among enterprises,which makes investors not optimistic about the future development prospect of the game industry.In addition,due to the rapid development of the game industry and the frequent mergers and acquisitions within and across the industry,its requirements for the value evaluation of game enterprises are becoming higher and higher.There are some problems in China’s game industry,such as a huge amount of intangible assets and the poor correlation between capital input and output.How to evaluate the value of game enterprises more scientifically and reasonably has become the top priority of the development of game industry in the future.This paper introduces the development status of the game industry,combined with the elaboration of the main profit modes of the current mainstream Internet game enterprises,comprehensively analyzes the enterprise value composition of the Internet game enterprises,concludes that it is difficult to accurately and reasonably assess the value of companies of this type under the traditional valuation method.Learning from traditional assessment methods,taking into account the advantages and disadvantages of different models and the applicability of the game industry,according to the composition of enterprise value.The Internet game enterprise value is divided into two parts: the stable income created by the enterprise’s existing assets and the uncertain income brought by potential investment opportunities.Considering the different income characteristics of the two parts and the characteristics of Internet game enterprises,the real option theory is introduced.Based on the introduction and application of B-S option pricing model,the two parts of the enterprise value are evaluated by DCF method and B-S option pricing model,and a portfolio model is constructed to calculate the overall value of game enterprises.Then select the more representative Panax notoginseng mutual entertainment of Internet game enterprises as the evaluation case.According to the enterprise financial data and industry information,the combined model of DCF and B-S option pricing model is used to evaluate the two parts of income respectively.Comparing the appraisal result with the market value of the enterprise on the benchmark date,the error is within the acceptable range.This further proves the rationality and applicability of the combined model.