Research On The Issues Related To The SMEs Financing And Decision-making Of The Equity Financing In China

Chinese capital market is in historic development opportunities in recent years. The continued prosperity of secondary market brings alone the development of issue market, the establishment of Multi-level capital market entered real operational phase from discussion and pilot stage. Big expansion of the small and medium enterprise board and the introduction of GEM, means the birth of new financing opportunities.On the other hand, SMEs face difficulties in financing bottleneck for a long time in China, which constrains development and strengthening of the most creativity economies. SMEs are often at a loss when facing less financing options. How to decide becomes key to the development of enterprises.Based on the study financing theoretical knowledge, considering Chinese policy environment and the actual financial system, this paper analyses the Chinese SMEs' financing present situation, problems and causes, gives policy recommendations to address relevant issues. Then after analyzing SMEs' decision-making options of financing, proposes the optimal path for the SMEs which is equity financing in the capital market, and makes a detailed analysis of capital markets equity financing in two ways--IPO and Reverse Merger(RM), including cause, cost, process, schedule and other elements.Finally, makes a summary of the full text's major studies, and raises the issue pending further study.