The Research On The Performance And Influencing Factors Of Listed Firms Following Seasoned Equity Offerings

Based on the development experience of stock market, Seasoned Equity Offerings is the most important means of listed company's equity re-financing in the capital market. The performance of listed firms following SEO influences not only their long-term development, but also the investor and financial securities market. Many scholars in China also have done research on the operating performance of listed companies with SEO, but most of the ana1ysis lack data support. Even if they employed positive study, the approach is conducted with single indicator. Therefore systemic research on listed companies'SEO has great theoretic and practical significance.Firstly, the conception and the function of SEO, as well as its development process in China are introduced. And it elaborates the theory hypothesis on post-issue operating performance of SEO, and also reviews the company performance and the measure method. Then, 108 firms conducting SEO during 1998-2005 are analyzed and several financial indicators on listed company's performance are selected in this paper. Financial indicators contrast method and efficiency coefficient method are employed to the analysis. This method calculates the normal value of financial indicators to adjust time and industry. Furthermore, the Wilcoxon signed rank test method is introduced to examine the changes in operating performance. Considering the specific environment of China's stock market, the thesis constructs a multiple regression model. On this basis, we carry on an empirical research to the influencing factors such as company characteristic, SEO features and so on. The empirical studies support the earnings management hypothesis and the overvaluation hypothesis.The results suggest that Chinese firms conducting SEO generally have increasing profitably levels prior to the offering. Meanwhile, those companies experience a sharp, statistically significant decrease in profitability following the SEO in both time and industry-adjusted. According the above analysis, the paper conclude that market structure's flaw, regulation's failure may be the reason why the operating performance of listed company drops after SEO in the securities market of China. Based on that, we put forward a series of suggestions to improve the operating performance of listed companies in China in the end.