Growth Analysis of Listed Companies

1. Analysis of acompany's business strategy


Business strategy is an overall plan fora company’s long-term survival and continuous development in the face of fierce changes and severe challenges. It is the concentrated embodiment of an enterprise's strategic thoughts, the scientific regulation of the enterprise's business scope as well as the basis for making a plan.

Business strategy is to determine the relationship between the enterprise and the environment, to stipulate the business scope, growth direction and competition strategy of the enterprise to ensure the realization of the enterprise's mission.

It also helps the company to make full use of various opportunities existing in the environment and creating new opportunities, to reasonably adjust the enterprise structure and allocate all the resources. The business strategy should be formulated with holistic, long-term and forward-looking views. It defines the direction, speed and realization of the company's growth from a macro perspective.

Because the business strategy decides the future development of a company, it’s bound to be a complex task, even challenged by unpredictable, sudden problems. Therefore, it’s also difficult to standardize the evaluation of a company’s business strategy. Generally, it can be considered from the following aspects:

(1) Whether a company has a clear and unified business strategy.

(2) Stability of top management teams and the potential impact of its business strategy.

(3) Whether a company's investment projects, financial resources, research and innovation, human resources, etc. conforms to requirements of the company's business strategy.

(4) To analyze the competitive position of a company among the industry and market and whether its status is compatible with the corresponding business strategy.

(5) To evaluate its production strategy based on the life cycle of the company's products.

(6) The analysis of the company's competitive strategy.

2. Analysis on the characteristics of company scale change and expansion potential

The characteristics of company scale change and expansion potential are generally closely related to the industry development, market structure and its business strategy. It provides a micro perspective to analyze growth potential of a company.

It can be analyzed from the following aspects:

(1) What is driving the expansion of a company?There are huge differences between supply-driven and demand-driven strategies, creating market demands and catering market needs strategies, technology driven expansion and other factors driven expansion. All these analyses will reveal the underlying development rule of a company.

(2) To compare a company’s historic financial data, such as revenues, profits and assets, etc. It could help you have a better understanding of its development trends.

(3) To compare its financial data with peer companies, industry average levels. It could help you learn more about its industry status.

(4) To evaluate the prospect and potential market shares of its main products; to analyze its investment projects, predict its sales and margin.

(5) To evaluate its's financial position, its investing and financing potentials.