The Empirical Research On The Influence Of The Investment Expenditures Of Agriculrural Listed Companies

Investment decision is the main motive to promote business growth and increasecorporate value. To optimize the investment decision-making and reduce theinefficiency investment has become a hot research among scholars. China is aagricultural country, Agriculture is ours country’s basic industrial, agricultural-listedcompanies as the leaders of agricultural industrialization, who has a good role inpromoting the development of the agricultural economy.Because the investment of agricultural-listed companies has a longer investmentcycle, slower returns, and also has a lower profit, some agricultural listed companiesturn to the non-farm projects after they have listed. Look at whether the number ofagricultural listed companies, the scale or the total share capital and assets,agricultural listed companies is still in a difficult initial stage. In this paper, we studiedoverview of the agricultural listed companies in2011and the influencing factors ofagricultural listed companies in investment spending, it has very important theoreticaland practical significance.In this paper, we studied the A shares of Shenzhen and Shanghai agriculturallisted company in2007-2010and researched form the four aspects,such asasset-liability ratio,stake of the largest shareholder, Free Cash Flow and operatingrisk.Besides, From on macroscopic perspective, We have researched the externalfactors, Such as, the tax incentives and listed preferential policies, how to affect theinvestment spending.By descriptive statistics and regression analysis of the samples, we draw thefollowing conclusions:(1) The LEV is negatively correlated with investment expenditures. The higherthe debt ratio, the bigger financial risk and the company’s debt service pressure;conversely, it is no different.(2) the largest shareholder，free cash flow and operating risk is positivelycorrelated with investment expenditures. The greater the stake of the largestshareholder, the greater the possibility of the enterprise tunnel effect; if themanagement has sufficient free cash flow, it is easier to build their owner tunnel, Ifthe company has the bigger operating risk, investment spending will be increased tocope with the pressure from the increasing accounts receivable. According to theresults of the empirical research, this paper proposes policy recommendations in order to improve the phenomenon of the small scale agricultural investment in listedcompanies and the low investment returns.