A Study On The Debt Financing Structure And The Corporate Performance Of The Listed Real Estate Companies In China

The debt financing is a very important source of capital, especially for the real estateindustry which is the eapital intensive. Many scholars and business managers focus onhow to make debt financing structures decision right and scientifically, so that theycan improve the performance of the enterprises. It can also help the national economygain a sustained and steady growth.This paper firstly reviews and concludes the research status of scholars at home andabroad about how the debt financing structures influences the corporate performance.Based on the former research achievement, this paper brings out the research directionand method. Secondly the paper reviews the related theories, analyzing that the debtfinancing structures influences the corporate performance from financial level effect,tax shield effect, incentive effect and signaling effect. Thirdly the paper picks up123listed real estate companies from Shanghai Stock Exchange and Shenzhen StockExchange,which are listed for transactions from year2004to2013. Then the paperuses descriptive statistics method and panel regression method to analyze the selectedcompanies’ debt financing structures and performance. The result comes out that therelationship between asset-liability ratio and corporate performance is significantnegative，but the inverted-U-shape-relationship between them is not significant; therelationship between short-term debt ratio and corporate performance is significantnegative, so is the long-term debt ratio;,the bank loan financing ratio and corporatebond financing ratio all hold a significant negative correlation with corporateperformance; the commercial credit financing ratio holds a significant positivecorrelation with corporate performance. Finallly, the paper makes somerecommendations for real estate enterprises and the government.