Market Capitalization Management In China Listed Company

Since the state encourages all of the listed companies set up a system of market value management, the concept of market value management has becoming a hot topic in Chinese capital market.As a new concept and method of management, the practice of market value management for listed companies is still at the exploration stage, which means there must have some failures and mistakes during this period. What’s more, some listed companies are deep in crisis because of a failed market value management. Xiangeqing Co., Ltd( known as Cloud Live Technology Group Co., Ltd now), as the object of this study, is a typical failure case of market value management. Since the business crisis occurred, Xiangeqing Co., Ltd used series methods of market value management, hoping to change its serious operational difficulties. However, the situation is getting worse and worse because the failure action in market value management. Xiangeqing Co., Ltd has changed from a national famous Catering industry listed company to a company at the edge of bankruptcy. But there is something special, that is the market value of Xiangeqing Co., Ltd is higher and higher, which is obviously opposite to its financial condition.This article is based on the frame structure of market value management, start from 3 distortions: value creation, value management and value realization, combine the methods and the real situation of Xiangeqing Co., Ltd together and analysis its market value management. Compare the market value, MVA and the actual situation of Xiangeqing Co., Ltd, I made evaluations to each action. Through this, this article reveal the fact that the market value management of Xiangeqing Co., Ltd is totally failed. Then I analyzed the reason of this failure, offering some suggestions for other listed companies. Ignoring the real target of market value management and pursuing short-term profits blindly should be forbidden.