Research On The Valuation Of Unprofitable Enterprises On The SSE STAR MARKET

On November 5th,2018,General Secretary Xi Jinping declared the founding of the Science and Technology Innovation Board and initiated a trial registration system within it.The Shanghai Stock Exchange’s Science and Technology Innovation Board,as per its Listing Rules,stipulates that,although enterprises may be in a state of deficit when applying for listing,they should still have a strong chance of success and gain.A plethora of unprofitable technological innovation enterprises now have a fresh route and selection to take,while the valuation issue of these enterprises on the science and technology innovation board is also brought into focus.In the past,the traditional valuation technique disregarded the potential worth of enterprises’ investments,which can easily lead to a misjudgment of enterprise value and considerable mistakes.In this context,this paper chooses to conduct valuation research on Cambrian,one of the unprofitable enterprises of the Science and Technology Innovation Board.This paper takes the Cambrian period,the "first share of AI chip" of the Science and Technology Innovation Board,as the research object.After in-depth understanding of the artificial intelligence chip industry and relevant valuation models,it studies the Cambrian valuation,and studies the factors that affect the company’s value from both qualitative and quantitative aspects.Cambrian,the full name of China Cambrian Technology Co.,Ltd.,was established in March 2016 and landed on the Science and Technology Innovation Board of Shanghai Stock Exchange on July 20,2020.At the beginning of the listing,the sponsor determined the Cambrian issue price to be 64.39 yuan per share using the market-to-market ratio,but the Cambrian share price closed at 212.40 yuan per share on the date of listing,which was far from the valuation result of the sponsor.Since then,the market value of the Cambrian period has fallen all the way down,reaching a record low of 46.59 yuan per share on April 27,2022.It can be seen from this that the market has great differences on the value of unprofitable enterprises on the Science and Technology Innovation Board,and the traditional valuation methods have not been able to carry out more effective valuation.In this context,this paper introduces the Schwartz-Moon real option pricing model for valuation,and uses Monte Carlo simulation to obtain the cash flow that the enterprise may generate in the future.Compared with traditional valuation methods,this method focuses more on flexible management in dealing with uncertainty,which helps to solve more complex pricing problems,and the valuation process and results tend to be more practical.On this basis,the B-S real option model is used for comparative analysis to further test and judge the rationality of the valuation.The evaluation results show that the market has underestimated the value of Cambrian enterprises to a certain extent.This paper proposes policy recommendations that can be used as a basis for decision-making in pertinent functional departments.