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Research The Problems Of China's Listed Companies' Behavior In The Placement

Posted on:2002-03-13Degree:MasterType:Thesis
Country:ChinaCandidate:L RanFull Text:PDF
GTID:2156360032457033Subject:Business Administration
Abstract/Summary:PDF Full Text Request
Raising capital is the foundation of an enterprise's sound and continuous development, while as an important channel for equity capital raising of China's Listed companies, placement has significant influence to their further development. Placement has been developing quickly since 1993, however, due to China's economic environment, it also causes some illegitimate phenomenon and bring new problems to the capital market.From the prospective of the listed companies, this thesis analyzes the abnormal phenomenon and features of listed companies' behavior in the current placement; disclose the essence and roots of the problems; find out the main reason of listed companies' behavior and propose regulatory suggestions based on these analysis.First part of this thesis introduces the concept and character of placement from the prospective of enterprise's behavior of raising capital; analyzes the motivation of the placement and describes its micro and macro effects to the stock market, stock prices, and stockholders' fortune. Second part analyzes listed companies' some abnormal behaviors in the process of placement by positive research method. This section is mainly about six aspects: 1, motivation of insatiate eager for placement; 2,through illegitimate method, 3,low efficiency in the placement-raised capital utilization; 4,frequent changes of the investment project in the placement-raised capital utilization; 5, low subscription rate in the current placement, 6, abnormal behaviors of the main shareholders in China's current special equity structure. I describe the features and expressions of these problems through large amount of numbers and examples and present direct reasons of these problems and their negative effects. Third part emphasizes on reasons for the illegitimate behavior in the placement process. It is mainly analyzed from the perspectives of information asymmetry and system defects. I believe these two aspects are just the main reasons for the listed companies' illegitimate behaviors. Due to information asymmetry, participants in the placement have different information, which consequently causes various trust-agent relations. There are agents' moral hazards and investors' morale hazards in these relations. The former brings out the fever of placement and also the problems of the following capital utilization, while the later affect the result of placement and increase the hazard of failure. From the prospective of system arrangement, there are many loopholes in the placement approval procedure, qualification standard of the placement, equity structure and corporate governance of the listed companies, which affect behavior of listed companies in their placement procedure from different aspects and become the reasons for the problems above. Fourth part is some advice for the placement regulation, to reduce information asymmetry and system defects. As to information asymmetry, on one hand, we can enhance the information disclosure procedure of the listed companies and depend on the underwriter of the placement to deliver more information, increase the market transparency and reduce the degree of information asymmetry. On the other hand, we can use the credit system and legal system to control the moral hazards and minimize the negative effect of information asymmetry. As to the system defects, we should improve the regulatory and approval procedure, reform the equity structure of the listed companies, enhance corporate governance of the listed companies and increase rationality of the investors to guarantee the right behavior of the listed companies in their placement.
Keywords/Search Tags:Listed company Placement's Illegitimate behavior Regulation
PDF Full Text Request
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