Study On The Relationship Between Ownership Structure And Corporation Performance Of Chinese Real Estate Listed Companies

As a core issue in governing structural of the listed company, the structure of stock equity has always been an important direction in the research in company's management. Whether a company is equipped with a rational structure of stock equity has a decisive effect to the efficiency of governing structural and great impact on the performance of a company. Being a vital aspect of stock equity structural, stock equity concentration bores some significance both in theory and in practice when it is related to the performance of a company. As a result, many scholars both at home and abroad have strived substantively to conduct the theory and empirical research concerning this issue. Yet, unfortunately, none of these researches has pressed ahead a concerted conclusion.Ever since 1990, when China's first stock exchange was established, the national securities market and listed companies have witnessed a full growth. However, contributed to the fact that a large member of China's listed companies are originated from state-owned enterprises, the phenomena of stock equity division and a single share that takes up the decisive proportion are exclusive in China's listed companies. As the launch the reform of stock equity division in 2005, China has witnessed an upsurge of lifting the ban of non-tradable shares during 2006 to 2007 Such a situation has a great impact on the structure of China's securities market and the stock equity of companies. Therefore, it is highly important for us to study the relation between the stock equity structure of listed companies and the performance of companies. On the basis of the existed research findings, as well as the typical stock equity structure of China's listed companies, this article focuses on the relation between the stock equity structure of listed companies and the performance of companies, aiming to explore the relation between stock equity concentration and the performance of the national listed companies.This article is based on a three year's data from 2006 to 2008 of 44 domestic real estate companies listed in Shanghai and Shenzhen stock markets, to analyze the procreative impacts on the performance of those companies owning to different degree of concentration in stock equity.First of all, the article makes a brief introduction of the research background and its significance, expounds and defines some basic conceptions like stock equity structure and performance, for example. Besides, the article overviews the existed academic viewpoints and research findings on the relation between stock equity concentration and the performance of listed companies. And it also presents the research approach and the basic frame of this article. The, the article expounds the related theories of the relationship between stock equity concentration and the performance of companies. As it shows in theory, these two aspects are closely related to each other, because the perfection of the management structure of a company and its excellent business performance depend on the moderate concentration of stock equity. Given the theoretical analyses, this article has made detailed description and analyses of the present status and the open questions concerning the stock equity concentration in China's listed real estate companies, providing a flesh background for the following empirical analysis.Secondly, this article has made a series of empirical analysis towards the stock equity concentration and performance in real estate companies that are listed in Shanghai and Shenzhen stock markets. It analyses the reasons for choosing real estate business as its research target, puts forward a research hypotheses for the relation between stock equity concentration and business performance by applying the constructive variable indices, set up a data model for empirical research, and then concluded the relation between stock equity structure and performance of the listed real estate companies. The result shows that. The shareholding ratio of the biggest shareholder and top five stockholders are positively correlated with the Herfindahl Indices and business performance. While Z indices have less to do with the performance.Last but not the least, this article combines the existed theoretical and empirical analysis with the specific characters of real estate business, and recommend four points to optimize the stock equity structure of the listed real estate companies and enhance their business performance:(1)To optimize the equity structure; (2) To vigorously introduce institutional investor;(3) To enhance the exterior supervisory strength.This article emphases the research of the relation of stock equity concentration and business performance and puts forward suggestive conclusion and policy advices. The major attributes of this article lies in the following aspects: First, the writer of this article believes that the attributive definition for the listed national stock equity companies is ambiguous, therefore, this article has tried to avoid the data collected according to the attributive classification of stock equity. Rather, it analyzes the impact of concentration level in stock equity on business performance by applying mainly the indices in the field of stock equity concentration. Second, the lacking of a single standard in measuring the business performance also leads this article to depend on the profitability indices, including net assets earning rate ROE, earnings per share EPS, net assets cash rate NCFOE, as well as market value indices net rate PB to make its analysis. So as to measure the business performance from different angles in an all-round way; Third, in order to eliminate the impacts of time and business attributes, this article utilizes the data from the past three years in the field of real estate business as its target.