The Behavior And Effect Of Stock Financing Investment In Agricultural Listed Companies

This thesis focuses on action and effect of stock financing investment in agricultural listed companies with a framework of industry chain. Agricultural listed companies are special in china. On the one hand, the companies get preferential treatments from government and bear social responsibilities for agricultural industrialization. On the other hand, they want to keep away from"weak"agriculture to maximize the profit. The conflict above makes agricultural listed companies pass a different way. This thesis will answer the following investment questions: whether agricultural listed companies keep ahead in industrialization, whether they take the advantage of financing to develop agriculture, and how to help agricultural industrialization come true.Beginning with a brief background of financing advantange of agricultural listed companies, this thesis provides both theoretical and empirical studies on investment projects in different industry chains. This thesis also provides some dynamic game models in agricultural industrial chain with academic elements of agent theory, game theory, transaction cost theory and property right theory to find out the motivation of investment. And the investment effect is tested through three approaches, namely firm value, earning power profitability and growth power with regression models and case study in detail. This thesis follows the key of"motivation-action-effect"and is organized as follows:Part One (from chapter 1 to chapter 3) introduces the theoretical and realistic foundations. Chapter 1 is introduction, explaining the research background, theoretical and practical significance, framework and possible innovations. Chapter 2 provides literature review, which serves as the theoretical foundation of the research. The literature review abroad focuses on vertical integration and diversification based on contract theory. While that in China focuses on industrialization, diversification and change of stock financing investment projects. With the summary above, it provides the theoretical framework of the thesis. Chapter 3 is puts forward the realistic foundation of stock financing investment projects in agricultural listed companies, by briefly summarizing the institutional background such as financial support, preferential tax and subsidy in the development of agricultural listed companies, and by analyzing the investment characters in agricultural listed companies.Part Two (chapter 4 and chapter 5) provides the theoretical analysis of motivation and action both in agriculture and other industries. Chapter 4 puts forward dynamic games models with transaction cost and special investment to find out the motivation of investment in agricultural chain, meaning vertical integration will increase downstream parties'market share and upstream parties'profit. Chapter 5 is theoretical and empirical study of investment in other industry chains and points out the key motivation of diversification is to make use of resource effectively.Part Three (chapter 6 and chapter 7) is empirical and case study of investment effect. Chapter 6 provides some hypotheses based on the analysis of chapter 4 and chapter 5, and builds regression models to test the investment results from firm value, earning power profitability and growth power. Chapter 7 analyses investment projects in three listed companies of dairy products industry, and draws conclusions that agricultural listed companies should invest in agriculture chain with financing advantage to lead agricultural industrialization.Part Four (chapter 7) is the conclusion and prospect, presenting main conclusions from previous chapters and proposing a series of suggestions on how to develop agricultural listed companies. Also, the weakness and the further study is touched upon.Findings of thesis:(1) Agricultural listed companies keep ahead in industrialization with financing advantage. (2) The most important motivation of invest in vertical integration is to increase market share in downstream market. And the empirical study shows that most agricultural listed companies have invested both in vertically and horizontally integration. (3) The key motivation of diversification is to make use of resource effectively. (4) Most agricultural listed companies have changed the content of the original investment projects. It is popular to change from agricultural industry to other industries. While vice versa is rare. (5) The change of original investment projects increases earning power and growth power, but reduces firm value, which means the action depresses the investors in trust. (6) Case study shows vertical integration will help listed companies keep competitive edge in different economic circumstances.Based on the study above, the innovations include:(1) In research system, it brings forth new ideas of industrial chain to analyze different investment projects. Within the framework the new classification of investment choices, namely vertical integration in agricultural chain and diversification in non-agricultural chain, makes the research system more clear, and brings a comprehensive study of action and effect. (2) Regarding the theoretical study, it applies the characteristics of agricultural chain to analysis, and builds up companies'vertical integration decision models and competition models. The dynamic game models are based on the farmers'small-scale production to find the invest motivation and evolution of industrialization. (3) It chooses a comprehensive indicator system including firm value, earning power profitability and growth power to test investment results. The indicators reflect the investors'attitude and the companies'earning power in the short term and the companies'growth power in the long term.