The impact of diversification on Chinese enterprise value

Abstract

Diversification is an important way for a company to grow and an important research topic for corporate finance. The core issue of diversification research is the impact of diversification on company value. However, in Chinese academia, there are few studies on the impact of diversification on the value of Chinese companies. Diversification strategy is the main problem that Chinese enterprises will encounter when they develop to a certain scale and stage. Not all companies that chose a diversification strategy finally achieved their goals and increased their profits. But this does not mean that there is a problem with the diversification strategy itself.

The research objective of this thesis is to understand under what circumstances choosing a diversification strategy can achieve the company's goals and achieve success. This thesis will use a qualitative method, including literature review, case analysis and other methods to obtain information in a natural context to explain whether companies can succeed in using diversification strategies and the reasons for failure.

This thesis will study the situation of Chinese companies' implementation of diversified management strategies, summarize existing research, deeply explore the relationship between diversification and enterprises, and study diversified management strategies from the perspective of corporate life cycle combined with case analysis.

The conclusion of the thesis is that according to the influence of company diversification on company performance, it provides specific guidance for the company to choose the type of diversification strategy reasonably according to its own development stage.