Research On The Impact Of Corporate Growth To The Enterprise Debt Financing And Its Structure

In September 2010, the State Council adopted the "Decision of the State Council on Accelerating the development of strategic and emerging industries," clearly stated that the development of new energy industry is an important direction for strategic emerging industries, as the main force of the new energy industry, solar photovoltaic industry is supported by the state sunrise industry, it’s growing is concerned by society and government. Industry financing has become a research topic of great significance, and debt financing is always an important financing channel for photovoltaic industry.Theory of corporate finances stated that the corporate growth and corporate finance are inseparable. Compared to debt financing, the solar photovoltaic industry leading listed companies prefer equity financing, and tend to select short-term debt financing,in the short-term debt financing,companies tend to select commercial credit financing, based on this, this paper intends to explore how the growth of listed companies in the choice of solar PV affects the companies’financing structure.This paper studies the relationship between corporate growth and debt financing structure. We use sample of the Annual Financial Report from year 2008-2013 of the listed solar photovoltaic companies in the Shanghai & Shenzhen Stock Exchange. We tested the relationship between the explanatory variable corporate growth, and the explained variables asset-liability ratio, long-term debt ratio and commercial credit ratio? by using the multiple linear regression model. The purpose of the paper is to find whether there is a significant correlation between corporate growth with the selection of debt and its internal structure. The empirical results shows that the growth of the solar PV listed companies has a significant negative impact on its asset-liability ratio,the higher the growth is, the lower the size of its debt financing.Growth of the solar PV listed companies also has a significant negative impact its debt maturity, that is, the higher the growth is,the shorter the debt maturity, our study also find that the growth of the solar PV listed companies has a significant positive impact on the using of commercial credit.The results of this study show that, in the course of financing to emerging industries, the existence of agency problem of debtor and creditor, due to the existence of agency cost more in debt financing, high growth firms generally rely less on debt financing, and use more short-term debt financing. Visibly, the agency problems of debt financing constraints the overall scale of debt financing of photovoltaic and other emerging industries.This article proves the necessity of photovoltaic and other emerging industries from a growth perspective of finance innovation, and has certain reference significance for the capital market to support emerging industry growth mode.