Status And Optimization Of Capital Structure Of Listed Companies In Hunan Province

The capital composition in this paper mainly refers to the debt or possessioners' rights to total capital ratio. No matter in early periods or modern days' capital composition theory, many western economists never stop their studies in financial or capital. Composition in order to find the optimum capital composition and realize the biggest value of business entities.According to the theory of some classic western economists, when the business entities need outside financial help, the first way they can think of is debt in stead of issuing stocks. While analyzing the capital composition of listed companies in Hunan province, we know that they show strong preference to the stock finance, namely, put emphasis on stocks and ignore debts hence, it causes to a lot of troubles in capital composition. Trying to find the reasons, we get to know that it is closely related to the invalidity of capital market and that of the manager inspiration and binding system in our country. However, the source of it still lies in the unreasonable stock helding composition. As to the present situation, this paper proposes the following way, such as reducing state owned stocks and lowering its ratio, developing matured capital market and perfecting yearly salary system, building stock holding inspiration me chanism and encouraging debt financing. By using this ways, we can make the capital composition of listed companies in Hunan province more reasonable.