An Empirical Research On Factors Influencing Performance Change Of Enterprises Listed On Growth Enterprise Market Before And After IPO

As an important fund-raising channel, IPO(Initial Public Offerings) is crucial to enterprises listed on GEM(Growth Enterprise Market). Not only can enterprises receive investment capital, but enterprises will be changed fundamentally in management operating system since the different operational and regulatory requirements after IPO which are of benefit to enterprises’ standardized management and value promotion. For these reasons, there is a motivation to IPO for enterprises listed on GEM. According to statistics, the number of enterprises had increased 16 times by the end of 2015 compared with the initial period of GEM and 79 enterprises on average went public on GEM each year. This phenomenal illustrates that enterprises has a high demand for IPO on the GEM. However, it has become a common situation that performance of enterprises listed on GEM declines after IPO which is bad for enterprises’ future development and brings hindrance to sustainable development of our multiple level capital market. Therefore, based on the high demand for IPO on the GEM, the decline of performance after IPO and the resulting problems for security market, analyzing the factors influencing performance change of enterprises listed on GEM before and after IPO and concluding suggestions for improvement are the key to resolving problems.Based on inducing domestic and foreign literatures of performance change before and after IPO, this thesis summarizes theories relating to performance change and regards it as the theoretical basis of research. Besides, commentary on domestic and foreign studies of performance changes and its influenc ing factors before and after IPO are presented in this thes is. Then analys is of factors influencing performance change of enterprises listed on GEM is conducted.Enterprises that went public on GEM during 2010 to 2012 are selected as the research object and the previous two years to the following two years of IPO are chosen as the research period. Firstly, current situation of performance change of enterprises listed on GEM are analyzed from four aspects which are profitability, operating capacity, debt paying ability and growth ability. Then factors influencing performance change of enterprises listed on GEM before and after IPO are analyzed from the aspects of ownership structure, earnings management, financing scale and price earnings ratio on theory. Fina lly, the thesis conducts an empirical analysis on influencing factors through setting up Tobit model which regards performance change before and after IPO as the dependent variable and takes ownership structure, earnings management, financ ing scale and price earnings ratio as independent variables.The results show that performance of enterprises listed on GEM demonstrated decreasing tendency after IPO which is reflected by the change of profitability, operating capacity, debt paying ability and growth ability. The study also indicates that venture capital is significantly and positively correlated with the performance change of enterprises listed on GEM after IPO, the real earnings management has significant negative correlation with the performance change, the negative effects of real earnings management on performance change after IPO are more serious than accrual earnings management and financ ing scale has remarkable negative correlation with performance change. In addition, the significant correlations between other influencing factors and performance change of enterprises listed on GEM before and after IPO are not found.According to empirical findings some suggestions for improvement are propound. Enterprises listed on GEM should enhance corporate governance and improve the fund use efficiency. Investors should make a comprehensive survey to the market rationally before investing. Securities regulators should strengthen supervision and inspection of corporate internal governance, standardize operation and development of venture-capital market, require enterprises to perfect the information announcing system and improve the level of management and control of capital. Consequently, the negative effects on performance change after IPO are expected to be reduced so as to promote the regulated and orderly development of the GEM.