Market Capitalization Management In China Listed Company

Value-based management is a new concept and method of management, which was firstly raised by US business community and then, in the1980s, defined by McKinsey, a management consultancy. The core of early value-based management was simply to maximize the shareholder value and merge various function areas that could realize the enterprise value. These areas referred to finance, strategy, internal control, incentive mechanism, etc., based on which business plans, organization, measurement, incentive mechanism, internal control, and corporate culture were integrated together. Simultaneously, a full-participation system was formed and enterprise value occupied the primary status in the management concept.The split share reform has been implemented in the Chinese stock market since2005. Under this background, it becomes an essential issue to all of the listed companies that how to promote the intrinsic and market value of an enterprise by reasonable and effective market value management.Market value management is a strategic management behavior whose purpose is to pursue the maximum value based on the market value signal by multiple scientific methods. From the definition of market value management, it consists of two aspects. One is value creating within the enterprise, which means to improve profitability, promote the intrinsic value by value creation strategy to achieve for the maximum value. The other is value realization on stock market. Market value management puts special emphasis on the intrinsic value reflected actually by share price, and increases the market recognition by value management and realization in order to obtain the optimized value realization.At present, though market value management has been a popular topic in practice, there are rare systematic researches on the market value management of listed companies. In this dissertation, the research was conducted upon the concept of value management. The purpose of this research was to find a value management method suited the Chinese listed companies. For this purpose, the driving factors and main methods of market value management of the Chinese listed companies were analyzed under the conditions of China, and Sany Heavy Industry, the first one performed split share reform, was taken as a practical case.