A Research On Price Effect Of Listed Companies’Participation In Corporate Venture Capital

Corporate Venture Capital refers to the venture capital activities carried out by non-financial enterprises with specific main business. With gradual establishment and development of multi-level capital market, as a special form of venture capital, Corporate Venture Capital (CVC) is also experiencing rapid development.However, compared with rapid development of China’s CVC, related research seems insufficient. Currently the enterprises participating in CVC are mainly listed companies. Among the related literatures, the majority are theoretic research. Empirical research is less, including profit and innovation from CVC. No attention is paid to listed companies’performance in stock market which is the important signal of company quality, internal value and management situation. Therefore, taking domestic listed companies involving in CVC as research object and studying the price effect have important theoretic and practical significance to CVC industry and subject listed companies.This paper mainly studies the price effect of listed companies’participation in CVC and the factors that influence stock price. This paper firstly introduces the related basic theories and reviews foreign and domestic literatures. Then it analyses the current situation and potential problems of listed companies’ participation in CVC. After that, by using event studying methodology, it studies the CVC temporary announcement disclosure’s influence on average abnormal return(AAR) and cumulated abnormal return(CAR). Then this paper proposes hypothesis and builds a multivariate regression equation to find out factors that cause price effect. Finally, this paper refers to related experience of foreign CVC and proposes practical policy and suggestion in the terms of investors, listed companies, government and capital market restrain mechanism.Through theoretic analysis and empirical research, this paper comes to the following conclusion.Listed companies in Shanghai and Shenzhen market are matched quantitatively. Geographic differentia is distinct, which is corresponding to the situation of venture capital. The majority of target companies have a large issuing scale. Target companies have clear main business in non-financial and traditional industries. Investment amount of CVC is at the level of10million to50million with a intermediate level. The problems includes less overall amount, sole investment model, leading financial benefit, short-term return focus, neglect of future growth.For all samples, within the CVC announcement event window, significant positive CAAR can be got, which means the CVC event has certain volatility effect on stock price.For classifying samples, S1(before2009.3.31) experienced little stock price fluctuation and group S2(after2009.3.31) witnessed significant AAR, CAAR and obvious stock price fluctuation.When coming to the factors that influence CAAR, Concentration Ratio, EPS and PE are respectively positive, positive and negative, which means positive, positive and negative effect as expected. The proportion of investment amount in total assets and the listed companies’equity in VC is positive as expected.