The Analysis On The Efficiency Of Equity Refinancing Of Chinese Listed Companies

The refinancing of listed companies or seasoned equity offerings are comprised of rights offering, additional share issuing, convertible bonds and equity warrant bond which was introduced in 2006. The real efficiency problem refers to the operational efficiency of refinancing system, and analysis is made on whether there is any improvement of financial indices after the refinancing behavior of the listed companies.The thesis selected the samples from 2002 to 2004 of Chinese listed companies which had offered rights, issued additional share, issued convertible bonds or equity warrant bonds. Financial indices are applied to study the changes before and after the refinancial behavior on a time-serial analysis.T-statistics test are also performed to test the significance of differences of financial indices means.Case study are applied to equity warrant bonds.The main conclusion of the thesis listed as follows:(1) Financial indices are turning downwards after refinancing by either method. The companies refinanced by rights offering have a significant declination from the first to the third year of rights offering in terms of profitability and solvency indices. For the companies refinanced by issuing additional shares, the declination is obvious in the first and second year of refinancing and then there is significant declination in the following years. Except for the ROE, liability-asset ratio, net operational cash per share and operational cash-asset ratio, there is no significant declination in the company refinanced by issuing convertible bonds.(2) All the financial indices are not turning downwards for those companies refinanced by issuing equity warrant bonds.(3) The characteristics of emerging, speculation, fluctuation and uncertainty of Chinese market have an impact on the refinancing efficiency, which turns out to be a new risk for the listed companies.