The Revelation And Analysis Of Jingyi Metal Co.,Ltd's Performance Deterioration After The Listing

In recent years of China's capital market,the listed companies' performance decline after the IPO has occurred frequently.Among the complicated reasons for performance decline after the IPO,what concerns government regulators most is overstated financial statements followed by performance deterioration of the company.The study found that the enterprise might make up a story about its scale and profit to achieve the selection preference of sustaining profit for three years continuously before the company can be listed.The act could not only influence seriously the interests of shareholders,creditors and external investors,but also cause mismatching of market resources which would cause instability and development of the capital market.Based on the aforementioned,the article chose Jingyi Metal Co.Ltd,the pillar industry of copper in Guangdong Province,as the research object.Jingyi owns professional high-tech industry chain of “copper assembly processing equipment,precision copper pipe,deep processed copper products”.Also,it is typical of performance deterioration after the IPO.Ever after Jingyi came into the market,its performance has fallen off a cliff due to the negative influence from external environment and internal management.The most urgent need for Jingyi's survival and future development is to reverse the performance decline and improve its competitiveness.First of all,with the careful comparison of the financial data before and after the listing,we found evidence of the performance decline of the company;Secondly,we studied comprehensively on its non-financial information and found several possible causes of the performance deterioration,which are concluded as followings: financial manipulation before the listing;ineffective management after the listing;benefit transfer;lack of driving force for innovation;the related party merger and acquisition.Thirdly,we put forward several suggestions on problems mentioned above.Countermeasures on system construction,company governance,investment decision,and technological innovation are discussed.Finally,implications on deterioration are generated from the great change of the company performance before and after IPO and analysis on the causes.Through the cause analysis of the performance deterioration of Jingyi,the results could not only help investors earlier identify the earnings management behavior of the enterprise and potential performance change so as to avoid risk and choose appropriate investment strategies;but also benefit the government regulators in better identifying and selecting worth-investing companies and taking feasible measures to protect the steady development of the stock market and benefits of the minority investors.