Study On The Relationship Between Capital Structure And Financing Decision Of Chinese Listed Companies

Study of capital structure is the main content of the theory of enterprises management. Based on the target of maximizing the enterprise value or the stockholders' richness, the theory of the capital structure is to study the effect of proportions change between liabilities and equity in the enterprises capital structure upon enterprise value. Chinese listed companies' behavior of equity financing preference not only violates companies' financing theory and practices, but also reduces the efficiency of capital utilization and makes a lot of corporate finance in capital market.With the development of the securities market, the function of circulating funds is getting very well in the past few years. In Chinese listed companies, the structure of the circulating funds shows that the proportion of the circulating funds inside enterprises is very low, while the circulating funds outside is higher. Among Chinese listed companies, strong favoritism to stocks is the outstanding characteristics in the structure of the circulating funds.By exercising the general theory of the capital structure, combining the theory of capital structure with our actual capital market, according to the latest situation and characteristic of the capital structure in Chinese listed companies, this paper sums up the main problem on the capital structure in Chinese listed companies-have a partiality for the circulating funds by stocks based on the analysis of the capital structure and conditions of profits.But in comparison with financing ways of western countries, Chinese listed companies financing preference is to the contrary. In China, the financing of listed companies always follow this order: equity financing, debt-financing and internal financing. Moreover, based on the up-to-date situations of the Chinese listed companies, it exhaustively analyses the reason to come into being this problem, such as inside reason, external reason and the systematic and non-systematic factors. At the same time it also makes a thorough analysis on the negative influence of the circulating funds by stocks widely. At last, with the guide of the theory of the capital structure, it sets up some improving approaches of optimizing capital structure and related policies. Furthermore, according these approaches, it gives the solutions to how to improve the capital structure in Chinese listed companies, how to solve the partiality for the circulating funds by stocks, etc.