Research On Financing Structure In Thermal Power Listed Companies

Corporate finance is very important to the management decision-making in modern enterprise. The disparate financing way leads to disparate financing structure. It has great influence to the development of the enterprise. Seen from the actual condition of our country, Chinese capital market is a new market, the modern enterprise institution hasn't set up yet, there must be some special character during to their special financing behavior. The research object of this paper is the thermal power listed companies in China, I will research the financial behavior, discover the existed problem and search for the origin of the this problem in thermal power listed company, all of these will be very helpful to standardize the financial behavior and foster the long development of the thermal power listed company.Firstly, this paper reviews the theory of corporate financing in Occident, which can be divided it into three stages. The first stage is named as early financial stage and the delegate is Durand. The second stage is centered on MM theory, which can be called the modern enterprise financing theory, and form the balance theory by Myers, Jensen & Meckling at last. The third stage is developed by the researching of asymmetric information theory. The researching result is that the developed countries have the sequence of rational corporate financing: internal fund-raising, debt financing, equity financing, named as pecking-order theory, which is widely-followed in the financing practice .But Chinese economists found that Chinese listed companies have shown the equity financing preference. This is obviously contrary to the developed countries.Secondly, this paper studies the thermal power listed companies from 1998 to 2004, I find that the thermal power companies have the equity financing preference, too. They will not consider the other financing way first unless the stock market financing is affected greatly. According to return on equity index, the financing efficiency is declining after the equity financing, I will explain it through institutional factor, financing cost factor, asymmetric information and bond market factor.Finally, I come to the paper conclusion and reach at some policy advices which may be benefited to solve the equity financing preference.