Industrial Capital Non-controlling Equity Investment Research

In this era of global competition, capital flow, logistics and information channels change with the improvement of information management technology and the globalization of the market. Multinational enterprises are carrying out revolution to the value structure of the industry chain through vertical and horizontal merge and acquisitions across the world, optimization of the management of supply chain and information management system, and thus gradually enhance their competitive edge in the whole industry chain. This means that the core competitiveness of a single enterprise in a particular link has to be re-positioned based on its view of the whole industry value chain, while combining with the essence of the Five Forces Strategy Theory, the Value Network Model, and the Resource Based View. The Market Influence Model built on the industry chain competitiveness and based on the Structure-Conduct-Performance research model, examined in depth the non-ownership investment of public listed companies, pointed out that the Market Influence Model can well-define the industry chain competition while avoiding the disadvantage brought about by the traditional vertical and horizontal integration of the industry.As the Chinese stock market enters the age of full circulation, the capital market is undergoing a tremendous change. The industry capital will gradually take over about 60% of the market value. On the other hand, the financial capital, with insurance funds and public funds as its representatives, will take control of only about 30% of the A share market value. The market will witness the power game between the industry capital and the financial capital. In this era, the industry capital will be more powerful and act as the key player of the capital market.With such background, this paper put the Market Influence Model into practice in Chinese capital market, through analyzing the two typical industrial investment behaviors of industry funds and industry enterprises, from the aspects of "industry funds doing non-ownership investment in listed companies" and "listed companies doing cross non-ownership investment", by means of theoretical analysis, case studies, and empirical analysis into the non-ownership investment behavior of listed companies, point out that industry funds can promote the value of the companies being invested in and that strategic holding listed companies can stimulate their own value by steady share holding.Last, the traditional economics approach treats the operation of enterprises as black-box practices. The usual research into the performance of listed companies does not elaborate on the detailed practical operation of the companies, but only rests on the simple correlation analysis of key elements such as equity structure and company performance. This paper, after combing through the logic behind the process of structure to performance, based on the research frame of game theory, by setting up Following Model and Stock Holder Gaming Model, discusses the competitive and collaborative relationship between industry funds and their investment targets, and expounds completely the mechanism of improving company value through non-ownership equity investment from the aspect of listed company conduct.