Research On The Influence Of Private Share Placement On The Stock Prices Effect Of Listed Companies

With China's marketization deepened at an ever increasing speed,there arises a wider range of methods for public companies' refunding.CSRC(China Securities Regulatory Commission)has enacted the Management Measures for Securities Issuance of Public Company in 2006,which officially authorized such a refunding way as private share placement in its securities market.Compared with other already existing refinancing means,private share placement possesses a variety of advantages,ranging from lower financing cost,comparatively easier censoring procedures for additional issuing to higher successful rate of issuing.Since its implementation in China's stock market,the scale of private placement has been expanding at an accelerated pace.As this refinancing fashion is becoming increasingly important,it comes as an impending urgency to address the many concerns which may arise during the process of private share placement for listed enterprises.With regard to the data analyzed in this paper,it selects the A-shares public companies that successfully launch private share placement in Shanghai Stock Exchange during the period from 2006 to 2015.Further,this paper tries to survey the stock prices effect of those listed firms by means of event study.Based on the research conclusions of relevant scholars both home and abroad,the paper theoretically probes into the factors which may impose influence on the stock prices effect of private placement for A-shares public companies through related theories and hypotheses,building a multiple linear regression model by selecting the scale the listed company,the ratio of liabilities to assets,the concentration of ownership,objects and motives of reissuing and the sentiments of the investors as independent variables,and the cumulative abnormal return the dependent variable.Through pertinent empirical study,it is suggested that private share placement is positively connected with the public company's stock price in the short term.This paper later conducts contrastive analyses among private share placements under varying market circumstances and finds the discrepancy that private share placement generates for the stock prices effect of public firms in different market contexts.Lastly,it puts forwards a number of specific policy-based suggestions for the problems occurring during the research.