The Positive Study On Operating Performance Of Chinese Listed Firms Following Seasoned Equity Offering

In recent years, the seasoned equity offering has developed rapidly, has already become the most important ways to re-financing in China capital market. Facing the upsurge, the operating performance of Chinese listed company to become the focal point which the pubic and the scholars will pay attention. After studying the literature review, we discover that, the studies about seasoned equity offering can be divided into two stages. The first stage research literature mainly concentrates in SEO pricing, the announcement effect and the wealth assignment effect; at the second stage many scholar also launched the research in the operating performance of listed companies with SEO, but mostly analysis lack the data to support. Even if adopted positive study, the research approach is relatively simplex.The paper makes use of descriptive statistics analysis,single-factor correlativity analysis and Multi-regression model . and use Spss,Excel to analyze the date of 92 listed companies which seasoned equity offering in 1998 to 2003 . The paper has mainly researched the operating performance change of Chinese listed companies between before SEO and after SEO, and the influencing factors based on the Free Cash Flow Hypothesis. The general result of this research: the operating performance of listed company dropped after SEO, and Free Cash Flow Hypothesis can explain the reason of the dropping after SEO.As we all know, the key function of the capital market–Optimize resource distribution, but the study conclusion indicates the operating performance of listed company was dropping after SEO, have obviously deviated this key function of capital market. I think that the performance have close relation with the defects existing on system and structure with China capital market that make China capital market unable to guide social resources to margin effectively, have weakened the resource distribution efficiency of the capital market. So this paper put forward a series of the counter measure to improve the operating of listed companies.