Analysis Of Financing Order Of Listed Companies

Financing structure refers to the proportion of endogenous financing and exogenous financing in corporate financing, and the financing way refers to the ways of raising money when the company takes endogenous financing and exogenous financing. Any company choosing the financing structure and the financing way is in certain market environment. Pecking order theory is one of the influencing theories of company financing structure research, which comes from the MM theorem and its revised theory put forward by American economist Modigliani and Millet in 1958. Although the pecking order theory can't solve practical financial issues, it has laid a solid foundation to promote the development of the theory of financing structure. In this theory, under asymmetric information, the company first prefers to endogenous financing, followed by the debt financing, finally the equity financing. But there is an abnormal phenomenon of financing preference in Chinese listed companies, with the financing order of the equity financing first, followed by the debt financing, and finally the endogenous financing.The thesis expounded domestic and overseas research achievements and summarized the financing ways the listed companies often taken. It described the development history of financing order of American listed companies and Chinese listed companies in detail, and analyzed the characteristics of the financing order in Chinese listed companies. The forming of the financing order conversing the pecking order theory is caused by various factors, including internal and external reasons, with some reasons can avoid and others can't change. When we know the reasons we can solve the problems. So it concluded that the suitable financing order to the listed companies in China should be that the debt financing first (bank loans combing with bonds issuance), followed by equity financing, and finally endogenous financing.In this paper, it discussed from three main reasons for choosing this financing order, including: (1) Bank loans combing with bonds issuance is the first choice for financing way, which benefits to raising money quickly; (2) Neither theoretically nor practically, the issuance of stocks should not be the primary choice of financing way; (3) Endogenous financing is insufficient, it just can be an ancillary financing way. Finally, the thesis put forward rational proposals for the choice of how to perfect financing order, and separately discussed from four aspects of developing the enterprise bond market, promoting marketization reform of the banking system, cultivating healthy stock market, improving endogenous financing of the enterprises in our country.