Research On Capital Structure And Corporate Performance Of Listed Companies In Chinese Biomedical Industry

The company’s capital structure is an important aspect affecting the company’s financial status and management capacity because it’s rationality is related to the profit and normal business activities of company. In the long run, it also can affect the company’s development and survival. Therefore, scholars are now trying to find an appropriate capital structure that can help business development. Now, from the biomedical industry perspective, Chinese rapid development of Bio-pharmaceutical industry has become an kind of indispensable force of a national economic development. This paper is to work out the relationship between biomedical companies’s capital structure and corporate performance, so that the resulting conclusions can guide the Chinese listed bio-pharmaceutical companies to develop more healthily.Bio-pharmaceutical companies is the study object of this paper and 225 selected samples from 75 listed companied who was listed during 2011 and 2013. Using the SPSS software,11 indicators were analyzed to generate new indicate factors for simplifying these factors. Then the asset-liability ratio, current liabilities ratio as debt structure, the largest shareholder stake (CR1) and the top ten shareholders (CR10) representing ownership structure are regarded as explanatory variables, at the same time the growth rate of total assets and the size of business is conducted as control variable for regression analysis.As showed in results of the rearche,with the increase of asset-liability ratio of Chine se listed bio-pharmaceutical company listed, the corporate performance significantly decr eased its capital structure as well as it was a negative correlation between capital structure and corporate performance. Furthermore, current liabilities ratio, the ratio of the top ten shareholders, company size and company growth between corporate performance were significant positive correlation. But the relationship between the ratio of the largest shareholder and corporate performance is not significant. Moreover, the capital structure and corporate performance of Chinese listed bio-pharmaceutical company result in the opening up of quadratic function, and the situation where the company’s performance is maximized optimal capital structure when capital structure is up to a number is not happened. That is there is not a best capital structure. Finally, based on the above findings, the author proposes a number of ways to optimize the capital structure of the listed bio-pharmaceutical company in China.