Enterprise Value Valuation of Cloud Service Companies based on the Modified DEVA Model: A Case Study of Kingsoft Office

Abstract

As cloud service enterprises, the quintessential products of the internet era, their deep integration with the real economy assumes pivotal significance for China's modernization drive. Characterized by a prominent proportion of intangible assets, these enterprises are susceptible to valuation distortions when appraised through conventional methodologies. Taking Kingsoft Office as a case study, this paper endeavors to enhance the traditional DEVA model by amending the user count, incorporating market share metrics, and introducing the payment penetration rate, with a view to further analyzing the accuracy of the model's valuation framework. The findings reveal that the revised DEVA model demonstrates a closer alignment with market capitalization and more effectively captures the underlying causes of value fluctuations, thereby offering a more nuanced understanding of the valuation dynamics in this context.