PV Enterprise Valuation Based On Improved Residual Income Model

The photovoltaic industry,as an extremely important field that can fully utilize solar energy to achieve green development,has expanded rapidly over the last decade.Driven by the policy background of China’s financial support for subsidies and the realization of "carbon peak,carbon neutral",China’s photovoltaic industry has reached the global leading position from the beginning.China’s photovoltaic industry has completed a perfect transformation and gorgeous transformation in ten years,and has a high international influence and competitiveness in the global photovoltaic market.With more and more PV enterprises listed,Chinese investors can enjoy the dividends of the development of the PV industry,and more investors choose to invest in PV enterprises in the secondary market.Therefore,it is particularly important to explore the use of reasonable valuation methods for enterprise value evaluation of PV enterprises,from which to provide certain reference for investors and decision makers.This article first conducts a series of sorting and understanding of the residual income model and relevant literature on enterprise value evaluation.It explores the advantages and disadvantages of three traditional evaluation methods,namely market method,cost method,and income method,and provides a detailed explanation of the prerequisites for use.It explains the theory,model formula,and basic assumptions of the residual income model,and identifies the advantages and disadvantages of the residual income model,Explore the specific types of enterprises that the residual income model is applicable to,and fully understand the applicable conditions.Based on the characteristics,current situation,and development background of the photovoltaic industry,TCL Central,a leading enterprise upstream of TCL Central,was selected.For TCL Central,the applicability analysis was conducted using the residual income model and three traditional evaluation methods,namely market method,cost method,and income method,to determine the rationality of the residual income model for evaluating the value of photovoltaic enterprises.Reasonably improve the principle of the residual income model to facilitate the specific enterprise value evaluation of the case enterprise TCL Central,and evaluate the enterprise value of TCL Central through improving the residual income model to obtain more reasonable and accurate results.After using the improved residual income model to obtain the evaluated TCL mid ring enterprise value,sensitivity factor analysis is conducted on the improved residual income model based on various valuation parameters in the enterprise price evaluation process,exploring the valuation parameters that have a significant impact on the enterprise value and strategies that can be adopted to enhance the value of the case enterprise.This study provides reference values for investment in the secondary market,also provides some reference information for the value evaluation of other enterprises in the photovoltaic industry.