Research Of Shenzhen Real Estate Company Information Disclosure Quality On The Influence Of The Cost Of Equity Capital

Information disclosure is a window of listed company, the quality of information disclosure like this window glass, its importance is self-evident. The Enterprise as an issuer identity need to clean the glass more bright and it’s message to the outside world, the more transparent to users of the information the better. It will be noticed to their own company’s existing or potential investors, creditors, the part of the government and other information users, outside investors will have a better chance to analysis the enterprise investment, and the information users can make the most useful decision. From this level, the information disclosure quality will be as a connection of bridge between the capital market of listed companies and the user’s of information.The cost of Equity capital in plain words to explain is refers to the expect of the lowest rate of return to the common stock shareholders, the basic form of shareholder expected reward is divided into dividend and share premium. The quality of Information disclosure is one of an affect factor to equity capital cost, there are two basic points on the theory:One of the theoretical view is that higher information disclosure quality increase the transparency and can make the stock liquidity increased, thereby reducing the equity capital cost and transaction cost; Another theory is that the improvement of the quality of information disclosure can reduce the investors prediction uncertainty.The reduced risk prediction that investors can accept a lower rate of return on investment, which is beneficial to reduce the equity capital cost.In this paper, we select from the shenzhen stock exchange listing of all the real estate industry as study samples to study the company’s information disclosure quality’s impact on the equity capital cost. The information disclosure quality measure use authority as a basis for rating results. Equity capital cost calculation method choose target price method, the control variable select the beta coefficient and book value ratio, etc. After constructing the model and empirical analysis, it is concluded that the information disclosure quality and equity capital cost have a very negative relevant evidence. We can see that China’s securities market is gradually mature, and also the quality of information disclosure to equity capital cost of the influence is still growing.