Study On The Relationship Between High Cash Dividends, High Transfer And Enterprise Growth Of Listed Companies

Companies’dividend policy is a financial strategy which stakeholders weigh the reinvestment of profits and reasonable return to investors. Research indicates that reasonable dividend policy will help the shareholders balance current income and sustainable development; it also will help corporations balance interests among major shareholder, minority shareholders and other stakeholders; at last, it contributes to regulating and promoting the healthy development of China’s stock market.The percentage of cash dividend companies has increased substantially since2000under the guidance of a series of dividend and financing policies launched by CSRC (China Securities Regulatory Commission), the phenomenon of high cash dividends have been becoming more prominent. In particular, the number of listed companies with high cash dividends is growing sharply since GEM (Growth Enterprises Market) has been launched since2009. Accompanied with high cash dividend and high transfer (double high), the proportion has increased gradually. The high cash dividends and high transfer phenomenon of listed companies have become the focus of attention and discussion in the securities market. What is the motive of the high cash dividends and high transfer behavior of listed companies? How long can they last? What impact will they have on the future growth of companies? Basing on the behavior of high cash dividends and high transfer in listed companies, this dissertation studies on how high cash dividends and high transfers of listed companies in China influence enterprise growth in order to provide empirical evidence for the stakeholders such as the market regulators and managers to develop a reasonable dividend policy from practical and theoretical perspectives.There are five parts in this dissertation. The first part is the introduction mainly covering research background, significance, status, route and method. The second part presents theoretical analysis of high cash dividends, high transfer and enterprise growth. In this part, the concepts of relevant research subjects are classified and the impact mechanisms of high cash dividends and high forwarding on enterprise growth are analyzed based on the fundamental theory of dividend policy. The third part discusses current situation of high cash dividends and high transfer, and their impact on enterprise growth. The overall situation of high cash dividends and high transfer in listed companies and industry distribution are analyzed statistically. The influence of the "double high" behavior on the growth is discussed. In the fourth part, empirical research outcome on the correlation between enterprise growth and "double high" is given. Based on the sample of GEM list companies in Shenzhen Stock Exchange in2009and2010, factor analysis method and multiple linear regression analysis method are adopted to analyze the influence of "double high" on the enterprise growth. The conclusions and suggestions is presented in the last part.The research results are as follows:it’s obvious for high cash dividends and high transfer behaviors of GEM listed companies in China. The number of "double high" companies has been growing year by year. Abnormal high cash dividends behavior exists in some companies which produces negative impact on the corporate growth partly; there are significantly positive correlation between cash dividends and corporate growth, but the correlation between cash dividends and corporate growth in high cash dividends companies is less than that in companies which don’t have high cash dividends behavior; the correlation between stock dividends and corporate growth is positive but insignificant, further evidence shows that the higher proportion transferred shares in listed companies, the less significant correlation.