Formation of optimal investment policy of small and medium-sized enterprises of the oil and gas industry

UDK: 338.45:622.276
DOI: 10.24887/0028-2448-2022-1-11-15
Key words: small and medium enterprises, investment police, typical project, internal rates of return, dividend discount model
Authors: A.S. Sarkisov (Gubkin University, RF, Moscow), E.V. Nikolaeva (RZD JSCo, RF, Moscow)

Small and medium-sized enterprises (SMEs) are important sources of economic growth, new jobs, healthy competition, contribute to the uniform development of the country's regions and the creation of an economy based on scientific knowledge and innovation. Since there is turbulence in the energy market in a globalized economy, SMEs must maintain their competitiveness in this unstable, rapidly changing economic and social environment, adapting to possible changes, because the most sustainable enterprises are not the most profitable and technically equipped, but those that adapt best to changes and crisis situations.

The paper analyzes the state and prospects of small business development in the Russian oil and gas industry. The method of forming the optimal investment policy of small and medium-sized enterprises of the oil and gas industry is described. It is based on the representation of their activities in the form of a set of standard projects (operations) related to a certain area of the oil and gas industry (hydrocarbon production, services in the field of hydrocarbon production, their processing, transportation, storage and sale of oil, petroleum products and gas, etc.). As an optimization criterion, the value of the enterprise is used, which is estimated using the dividend discounting model. The method is illustrated by the example of a small oil-producing enterprise, for which the optimal share of profit reinvested in new investment projects was determined, and the influence on the investment policy of the planning horizon and the required rate of return of the owners of the enterprise was studied. It is shown that the dependence of the enterprise value on the share of the reinvested profit is decreasing for short planning horizons, and it is a function that has a maximum for long planning horizons.

References

1. Edinyy reestr sub"ektov malogo i srednego predprinimatel'stva (Unified register of small and medium-sized businesses), URL: https://rmsp.nalog.ru/index.html

2. Indeks predprinimatel'skoy uverennosti (Entrepreneurial confidence index), URL: http://www.gks.ru/free_doc/new_site/metod/prom/met_pred-uver.htm.

3. Nikolaeva E.V., The development of a method of the analysis of stability of small and medium oil and gas enterprises economic development (In Russ.), Sovremennaya ekonomika: problemy i resheniya, 2017, no. 9, pp. 92-103, DOI:10.17308/meps.2017.9/1774

4. Sarkisov A.S., Finansirovanie kapital'nykh vlozheniy (Capital investment financing), Moscow: URSS Publ., 2019, 288 p.

5. Dorfman R., The meaning of internal rates of return, Journal of Finance, 1981, V. 36, no. 5, pp. 1011–1021.

6. Komarov M.A., Lineynye raznostnye uravneniya i ikh prilozheniya (Linear difference equations and their applications), Vladimir: Publ. of  Vladimir State University, 2012, 42 p.

7. Hotelling H., A general mathematical theory of depreciation, Journal of the American Statistical Association, 1925, V. 20, no. 151, pp. 340–353.

8. Gordon M.J., Dividends, earnings, and stock prices, The review of economics and statistics, 1959, V.41, no. 2, pp. 99–105.

9. Brealey R.A., Myers S.C., Allen F., Principles of corporate finance, McGraw–Hill, 2005.

10. Brigham E.F., Ehrhardt M.C., Financial management: Theory and practice, Cengage Learning, 2010, 1184 p.

11. Gordon M.J., Shapiro E., Capital equipment analysis: the required rate of profit, Management science, 1956, V. 3, no. 1, pp. 102–110.

12. Nikolaeva E.V., The analysis of stability of small and medium oil and gas enterprises functioning to adverse factors action (In Russ.), Sovremennaya ekonomika: problemy i resheniya, 2017, no. 7, pp. 91–99, 10.17308/meps.2017.7/1726

Small and medium-sized enterprises (SMEs) are important sources of economic growth, new jobs, healthy competition, contribute to the uniform development of the country's regions and the creation of an economy based on scientific knowledge and innovation. Since there is turbulence in the energy market in a globalized economy, SMEs must maintain their competitiveness in this unstable, rapidly changing economic and social environment, adapting to possible changes, because the most sustainable enterprises are not the most profitable and technically equipped, but those that adapt best to changes and crisis situations.

The paper analyzes the state and prospects of small business development in the Russian oil and gas industry. The method of forming the optimal investment policy of small and medium-sized enterprises of the oil and gas industry is described. It is based on the representation of their activities in the form of a set of standard projects (operations) related to a certain area of the oil and gas industry (hydrocarbon production, services in the field of hydrocarbon production, their processing, transportation, storage and sale of oil, petroleum products and gas, etc.). As an optimization criterion, the value of the enterprise is used, which is estimated using the dividend discounting model. The method is illustrated by the example of a small oil-producing enterprise, for which the optimal share of profit reinvested in new investment projects was determined, and the influence on the investment policy of the planning horizon and the required rate of return of the owners of the enterprise was studied. It is shown that the dependence of the enterprise value on the share of the reinvested profit is decreasing for short planning horizons, and it is a function that has a maximum for long planning horizons.

References

1. Edinyy reestr sub"ektov malogo i srednego predprinimatel'stva (Unified register of small and medium-sized businesses), URL: https://rmsp.nalog.ru/index.html

2. Indeks predprinimatel'skoy uverennosti (Entrepreneurial confidence index), URL: http://www.gks.ru/free_doc/new_site/metod/prom/met_pred-uver.htm.

3. Nikolaeva E.V., The development of a method of the analysis of stability of small and medium oil and gas enterprises economic development (In Russ.), Sovremennaya ekonomika: problemy i resheniya, 2017, no. 9, pp. 92-103, DOI:10.17308/meps.2017.9/1774

4. Sarkisov A.S., Finansirovanie kapital'nykh vlozheniy (Capital investment financing), Moscow: URSS Publ., 2019, 288 p.

5. Dorfman R., The meaning of internal rates of return, Journal of Finance, 1981, V. 36, no. 5, pp. 1011–1021.

6. Komarov M.A., Lineynye raznostnye uravneniya i ikh prilozheniya (Linear difference equations and their applications), Vladimir: Publ. of  Vladimir State University, 2012, 42 p.

7. Hotelling H., A general mathematical theory of depreciation, Journal of the American Statistical Association, 1925, V. 20, no. 151, pp. 340–353.

8. Gordon M.J., Dividends, earnings, and stock prices, The review of economics and statistics, 1959, V.41, no. 2, pp. 99–105.

9. Brealey R.A., Myers S.C., Allen F., Principles of corporate finance, McGraw–Hill, 2005.

10. Brigham E.F., Ehrhardt M.C., Financial management: Theory and practice, Cengage Learning, 2010, 1184 p.

11. Gordon M.J., Shapiro E., Capital equipment analysis: the required rate of profit, Management science, 1956, V. 3, no. 1, pp. 102–110.

12. Nikolaeva E.V., The analysis of stability of small and medium oil and gas enterprises functioning to adverse factors action (In Russ.), Sovremennaya ekonomika: problemy i resheniya, 2017, no. 7, pp. 91–99, 10.17308/meps.2017.7/1726


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