AN EVA-BASED STUDY OF FINANCIAL RISKS IN NANJING CHIXIA DEVELOP-MENT CO.,LTD

Abstract In mainland China, real estate companies often rely on loans from banks and other channels. As financial institutions raise interest rates to mitigate risks, liquidity in the real estate market tightens, leading to higher credit risks. This creates challenges for real estate enterprises in managing financial risks and ensuring steady growth. This paper focuses on Nanjing Chixia Development Co., Ltd. to evaluate its financial performance. It starts with an analysis of the company's basic condition and current performance indicators, then uses EVA (Economic Value Added) to assess after-tax net operating profit, total capital, and weighted average cost of capital. By comparing EVA with traditional performance metrics, this paper suggests optimizing the capital structure to improve financial performance. The study enhances the traditional evaluation methods and offers valuable insights for reducing financial risks and establishing a more scientific valuation system for the real estate sector.