Research On The Value Evaluation Of Enterprises In Star Market Under The Background Of Enterprise Life Cycle Theory

The development of technology is really essential in today’s world.No one can say that a country can develop technology without financial support especially in the Era of Economic globalization.In order to stimulate the innovative companies and support companies which are at initial stage,President Xi announced that STAR market was launched in 2019.Therefore,the international competitiveness of China’s capital market has been further enhanced.However,listed companies in STAR market are also faced with valuation problem.Solving this problem is of great significance to the STAR market as well as external investors and internal managers.Evaluating business valuation accurately assists internal managers make correct decision.To solve the problem of business evaluation,we focuses on the life cycle theory to carry out evaluation methods for listed companies of STAR market.This paper firstly introduces enterprise life cycle theory,describing the characteristics of four life stage.It is because the financial and operational characteristics of enterprises are disparate at different stages,we tried to find out the factors determining enterprise value.By studying the life cycle stage of the enterprise,we will conclude the evaluation method applicable to the enterprise in different stages,so as to reflect the real value of enterprises.After analyzing the suitable evaluation methods for each period,we tried to prove the perspective that it is suitable for high-tech companies using return method and real option method to evaluate its business value during the growing stage.So we chose Shenzhen Transsion Holdings Company as a case.Firstly we analyzed the life cycle stage of Shenzhen Transsion Holdings Company based on its financial indicators.And it was true that Shenzhen Transsion Holdings Company was at growing stage in 2020.Then we used return method and B-S Model to figure out its business value.Finally,we compared the valuation results with the market price of the company.This case actually proved our idea and it could provide a relatively reasonable method for the value evaluation of listed enterprises in STAR market.Afterall,we concluded that it is reasonable for company to evaluate business value base on its stage of life cycle.