Analysis Of Operating Performance Descend Of Chinese IPOs In Small And Medium-sized Enterprises Market

The SMEs are the backbone of promoting the development of the national economy, and are important source of new technology development, but also important channel to solve the employment problem, because the SMEs are generally character of small production scale, short cycle, quick returns, market adaptability, industry diverse, strong scientific and technological innovation capacity and other characteristics. As China’s SMEs’role is becoming more and more important in the national economy increasingly, the problem of financing for SMEs has attracted more and more attention. The launch of the SME board in2004, has provided SMEs with direct financing platform and a large extent mitigation the financing difficulties faced by SMEs. But, at the same time, another big hot issue appears, that is IPO effect which existed in listed companies of domestic and foreign capital markets. IPO effect is that the performance of the company, after the listing,has not been significantly improved, but declined.Whether IPO effect also exists in the listed companies in The Small Board of China, and the extent of IPO effects are different in different regions, combining the development of China’s capital market history, and selecting a representative financial indicators, this paper attempts to test it, using paired samples T-test and building the empirical analysis of panel data model. I found that profitability and growth capability index of sample objects appears significant decline in the listing year, and does not recover to the high-performance of pre-IPO after two years, solvency indicators peaked that year, although decreased after two years listing, still higher than the pre-IPO level. It is visible that public financing improved the capital structure and its solvency, and operational capability indices are decline at listed year, but not significant at statistics test. Therefore, the SME board listed companies also exist IPO effect overall, the presence of the company’s performance rise in seven years before and after the listing, then fall, similar to the inverted variation of "V" shaped. This article attempts to explain this variation from the enterprise business outside environment, thus using government administrative capacity, level of service and the level of financial intermediary development to build a multi-factor model, concluded through empirical research:the enterprise business outside environment, such as, the government administrative capacity, the level of service of Financial institutions and level of development of intermediary, can effectively explain the companies listed operating performance of decline. Finally, this paper proposes some policy recommendations on the based of empirical results.The purpose of writing for this article is on the one hand, is to do some simple complement and rich for the existing theory of IPO effect, on the other hand can help policy authorities realize the enterprise external environment impact on the local small and medium-sized enterprise operating performance, so as to help small and medium-sized enterprise development policy decision, and to help investors on the analysis of investment value at the same time, you can consider more enterprises operating environment to the area of auxiliary effect arising from the performance of the enterprise.