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Empirical research on the growth in the value of listed companies in China

Author: LuoErPing°°HuYing From: www.yourpaper.net Posted: 2009-10-15 09:36:41 Read:
[Abstract] In the case of China's capital market is still not perfect, the way to measure the growth in the value of listed companies will be affected by many factors and constraints, Tobin's Q value stock validity traditional evaluation methods are clearly not applicable. This article from the basic theory, combined with the reality of our country, based on the judgment of the future value of the listed companies the ability to grow, to re-build the evaluation index system on the growth in the value of the company, and from the the financial financial point of view of the impact factors of the growth in the value of listed companies Empirical Analysis, and then come to a conclusion, and contribute to the value of listed companies in China's growing suggestions put forward.
[Keywords] listed company; value growth; empirical research
First, the value of listed companies in China growth evaluation system

Traditional financial theory already has a mature evaluation index system of enterprise value, including the four major categories of shareholder interests ratios, profitability ratios, solvency ratios and asset operational capacity ratio. Them in the evaluation process more concerned about the current business value and operational conditions for corporate growth (value growth potential) consider less. As a listed company should not only focus on the immediate benefits, and pay more attention to the trends in the company's future for a long time. Therefore, on the basis of traditional financial evaluation, the introduction of the growth indicators (which represents the growth rate of the growth in profitability and capital expansion capacity indicators), to re-build the evaluation system can measure the value of listed companies the ability to grow.
After selection Excluding determine the indicators of the value of listed companies in China including growth evaluation system (as shown in Table 1):

Second, the growth in the value of listed companies in China influencing factors

(A) The theoretical analysis
Macroeconomic factors: economic cycles and national macroeconomic policy. Cyclical fluctuations in GDP, inflation rates, interest rates, unemployment rates, exchange rates and money supply, the amount of a country's economy and so will the fluctuation of the listed companies in the business environment changes they cause will inevitably affect its value. Different government fiscal and monetary policy control measures will affect the macroeconomic, thus affecting the survival and development of the main micro.
Meso factors: The main characteristics of the industry factors and location. The industry factors refers to the competitiveness and growth of the industry, industry cycles and government industries oriented - the industry is naive or growth, the government support, or by the impact of the economic cycle, promising great potential for enterprise development; otherwise, the enterprise is difficult there as well. In addition, the environment for the development of China's eastern, central and western regions of listed companies, its ability to grow in value affected.
Microeconomic factors: (1) capital structure. MM theory, liabilities higher help to enhance the value of the company. However, in China, the development of the corporate bond market lags behind the bank debt, in an absolutely dominant position in the corporate governance can not play an effective role in the debt ratio negatively correlated with the value of the company.
(2) the shareholding structure. Equity is highly fragmented, can easily lead to "internal control"; excessive concentration of equity, interest may arise encroachment effect; moderate ownership concentration, equity mutual checks and balances, management has been more effective supervision, contribute to the growth in the value of the company. In China, the listed companies exist due to the dominance problem of state-owned shares, and the absence of state-owned property rights, resulting in internal control, adverse impact to the company's growth. The split share structure reform implementation, and change the status of the different weights of the same stock price, to help China's securities market to achieve efficient allocation of resources to promote the sound development of the securities market.
(3) The dividend policy. The allocation of dividends derived from the pre-allocation of profits, it can be a direct reflection of the company's profitability, cash flow, but also determines the number of retained earnings can be used to reinvest in the company's financing structure and market is expected to be affected by the company's prospects, and thus its value growth.
(4) The size of the company. Its major impact on the value of growth to achieve economies of scale. Be able to enjoy the economies of scale, companies generally have, such as loans, the convenience of good relations with the government, the lower the unit cost of production and management, technology and equipment, the talent pool advantage, which is conducive to the long-term growth of the company.
(5) financial factors. Analysis from the company's profitability, solvency, operation ability. Company profitability, a large amount of free cash flow into bankruptcy less likely, more likely to get the support of external funding, to promote the sustainable development of companies; solvency, financial risk is small, benefit the virtuous cycle of production and management and value growth; operational ability of the company to fully rational use of the company can dominate, borrowed resources, improve the efficiency of the use of assets, enhanced profitability for the realization of the value of the company growth.
(6) Human Capital. Human capital is the most valuable core capital, it can ensure the enterprise to a leading position in the market competition in the era of knowledge economy, continue to create value for business and society. Groups ability to reflect the performance of the staff who, creative ability, leadership skills, problem-solving ability and business management skills, with the employees' level of education and experience.
(7) managers incentives. For listed companies, shareholders and managers target inconsistent, it is easy to form the so-called principal - agent costs, and "internal control" phenomenon. Reduce the efficiency loss of the principal - agent relationship, to the maximum extent in order to achieve the company's long-term value growth, it is necessary to form the appropriate management incentives, given a certain amount of annual dividends or shares, the management interests in a way and the interests of the shareholders to achieve consistent constraint management behavior.

(B) Empirical Analysis
Sample selection
This article belonging to the non-monopoly industries manufacturing food and beverage, electronics, machinery and equipment, and medical and biological class listed companies as a sample of the expedition. Excluding ST listed companies and some data is missing or abnormal sample points, the last of 282 available samples (data source: WIND information, space is limited, specific data omitted).
Ability to grow in value of listed companies score calculated
According to the theory of factor analysis, the use of the 18 indicators in the evaluation system of SPSS software, the growth in the value of China's listed companies previously built xi (i = 1,2, ..., 18) factor analysis to determine the common factor fi (i? Buckwheat 18 ), the number is 6, and determined their score function (omitted), and to calculate their respective score.
The expression value growth capacity composite score:
FGV = 0.2928f 1 0.2150 f 2 0.1085 f 3 0.0712 f 4 0.0639 f 5 0.0559 f 6 ...... 1
Where, FGV (Future Growth Value) represents the value of the listed companies ability to grow, the coefficient in front of the public factor fi is the proportion of its corresponding common factor in the total variance.
The common factor scores into the composite score for each sample value of the company the ability to grow that.
3 Empirical Analysis
(1) descriptive statistics (see Table 2)

First of all, from the industry point of analysis: the food and beverage category listed company FGV average maximum, electronics and pharmaceutical biotechnology class averages relatively low, the traditional industry, the value of listed companies the ability to grow higher than the growth industry of the company, and the electronics industry because of its fierce competition, the growth in the value of the least ability to synthesize. The company's ability to grow in value related to the industry.
Secondly, from the completion of the share reform perspective analysis (base date to January 1, 2006): higher average composite score has the share reform of listed companies, and its future capabilities, the development trend of better value.
(2) regression analysis
According to the previous analysis, factor analysis method to calculate the composite score as a representative of the dependent variable listed indicators of the value of the company the ability to grow, the influencing factors as independent variables to construct the regression equation is as follows:
FGV i = ¶Ń 1 ¶¬ 11 DEBT i ¶¬ 11 GF ¶¬ 13 GL ¶¬ 14 lnGM i
¶Ę 15 YG i ¶¬ 16 LEADER
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