Enterprise Value Evaluation Of Lenovo Group Based On Discounted Cash Flow Method

With the continuous development of economic globalization,my country’s comprehensive national strength is constantly increasing.At the same time,my country’s vision is gradually expanding,looking at the world market,and focusing on my country’s footprint in other countries.The Chinese government encourages major enterprises to make efforts to go abroad.At present,the main way for Chinese enterprises to go abroad is cross-border mergers and acquisitions.Chinese enterprises merge foreign enterprises for the purpose of control,so as to achieve the purpose of entering foreign markets and increasing their own market share.In the process of Chinese enterprises successfully entering foreign markets,it is indispensable to evaluate the value of enterprises.From the perspective of grey prediction,this thesis evaluates the value of Lenovo through cash flow discount model and GM(1,1)model.Firstly,the concept and method of enterprise value evaluation are described,the discounted cash flow model and grey prediction model are sorted out,and the applicability of combining the discounted cash flow model with GM(1,1)model is proposed;Secondly,it analyzes the basic situation of Lenovo Group and introduces its financial situation;Then the company’s forecast period(2022-2026)is estimated using the discounted cash flow method,and the potential value of the company is estimated using the discounted free cash flow method.Then the cash flow is predicted based on the improved GM(1,1)model.The results of the evaluation in 2022 are compared with the actual data,and the accuracy and rationality of the GM(1,1)model are explained through the calculation error.From the results of the study,Lenovo Group has the representative characteristics of the technology industry.Combined with the characteristics and requirements of GM(1,1)model,it is concluded that the value of high-tech enterprises can be estimated by combining the grey prediction with the discounted cash flow model.This method has certain applicability in the current situation of a lot of information asymmetry.For investors,if they want to invest accurately,they have to choose a model that is more suitable for the industry.The model in this thesis can provide some reference for investors in high-tech industry.