Analysis Of Cost Of Capital Of Cross-listed Science And Technology Enterprises

In recent years, China’s capital market is in rapid development. But it is undeniable that there is still a large gap in the development of the capital market in terms of market size, financing scale and market supervision in the country with the international developed capital market. In the background of economic globalization, more and more companies choose equity financing, in the international one, cross listed become the main way the company chooses of international financing. The main reason is that cross-listed can lower financing cost to raise more funds, optimize the company’s capital structure, increase the value of the company, broaden the financing channels, improve international competitiveness.Western scholars have studied many aspects of cross listed, including the use of event study method and the cost of equity capital measurement model to explore the theory and empirical test, however, the cost of capital effects of cross listing is not in unified recognized in an international context. According to the theory and practice of cross listing of China Company, it has caused a big discussion in Chinese theory circle and business circles in recent years and show the confrontation and collision of different ideas. The most fundamental issue is the problem of cross listing effect on corporate value growth, namely capital cost effect. In order to break the financing "bottleneck" of current Chinese enterprise, especially high-tech enterprise which need to constantly develop new markets, research on cross listing and financing have a far-reaching significance.This article mainly uses the dividend growth model and the cost of equity capital estimation model based on Ohlson model to estimate the cost of capital, to explore science and technology enterprises cross listed capital cost effect in our country. Draws the following three conclusions:(1) estimation of the cost of capital based on the cost of equity capital estimation model based on Ohlson model is lower than that of the dividend growth model;(2) China Science and technology enterprises can reduce the cost of capital by cross listing;(3) China Science and technology enterprises listed in Hong Kong can reduce the cost of capital by returning back to China mainland market. At last, we give policy recommendations to existing problems.