Research On Capital Structure Optimization Of Henan ZJ Machinery Company

Henan ZJ machinery company's main business is the production and processing services of agricultural machinery,engineering machinery,automobile and other mechanical parts.due to mechanical industry is a typical strong cycle industry,from 2009 to 2013,the industry boom cycle,in the face of the credit sales and deferred payment under pressure from the sales model,Henan ZJ machinery company is often obtained by means of short-term debt with money,but also accumulated a great financial pressure.After 2014,Henan ZJ machinery company faces the domestic and foreign demand,product profit margins,and many other difficulties,began to face a slowdown,capital pressure.Taking Henan ZJ machinery company as the research object,by collecting the company's financial information and operation data,combed the the company's financial position and capital structure present situation,thought the unreasonable capital structure decision,seriously affected the development of enterprise.This paper also identifies the topic of this article.The overall research idea of this paper is:to analyze the capital structure present situation to choose the best capital structure decision-making model-pointed out that the capital structure problem and cause capital structure optimization-design-the capital structure optimization measures are put forward-system safeguard measures are presented.The conclusions are as follows:First of all,based on the theory of capital structure,capital structure optimization method as theoretical basis of study,through field investigation and analysis,points out the problems that the capital structure of Henan ZJ machinery company includes:(1)the enterprise asset ratio is high,the current asset-liability ratio as high as 73.99%.(2)the liabilities structure is unreasonable,the long-term liabilities are 0,and the short-term liabilities are 100 percent.(3)the enterprise has insufficient working capital.The analysis of this paper points out that the causes of these problems are both internal and external.Secondly,this article is based on Henan ZJ machinery company nearly four years,and the capital market reasonable assumptions,calculate the cost of capital is 7.16%,current liabilities long-term liabilities of the cost of capital is 8.72%,through the capital asset pricing model calculates the cost of equity capital of 13.25%.Under the linear programming model,through QM software calculates the optimal solutions for:current liabilities to total assets ratio is 55%,the ratio of long-term debt to total assets is 10%;The ratio of equity capital to total assets is 35%.Thirdly,in order to help the Henan ZJ machinery company capital structure optimization,this paper design the following optimization measures:(1)to enhance profitability and operation ability,reduce the rate of assets and liabilities of enterprises;(2)seeking long-term borrowing to optimize the debt structure;(3)finding low-cost channels for borrowing;(4)to apply for the development and reform commission to obtain credit support;(5)to diversify and optimize the shareholding structure;(6)try to land on the new three boards.Individuals from the company's point of view,this paper designed for Henan ZJ machinery company capital structure improvement measures,to ensure sustainable operation,realize the enterprise value maximization,on the company's financial management practice has certain guiding significance.From the industry point of view,this article through to the Henan ZJ machinery company looking for the optimal capital structure and financing advice,for domestic trade machinery enterprise capital structure optimization have a certain significance,will help the industry enterprises achieve healthy and sustainable development.