Research On The Affecting Factors And Motivations Of High Cash Dividend Policy Of China Shenhua Energy Co.Ltd

Dividend policy is an important part of corporate behavior.The dividend policy of listed companies has been attracting people's attention and is also an important reference for many investors when making investment decisions.By analyzing the company's dividend policy,it not only reflects the business status of the company,but also directly relates to the image of the company,the interests of shareholders,and the possibility of future development of the company.Therefore,there has been a long-term research on dividend policy.Western countries started to study the dividend policy early and formed many mature dividend policy theories.However,because of starting late China is still exploring and expanding the related research continuously on the basis of previous studies.Currently,the research on the influencing factors of dividend policy has achieved certain results.Based on the previous theoretical research,this article specifically analyzes the case of dividend distribution of China Shenhua Energy Co.Ltd.The coal industry in which China Shenhua is has experienced a period of decline in the entire industry since 2012 after experiencing rapid growth for several years.The oversupply of coal has resulted in a drop in sales prices,and up to 80% of coal companies have suffered losses in 2015.Since 2016,China has implemented a capacity-removal plan to carry out supply-side reforms for the coal industry.Shenhua has always maintained a high dividend payout policy since its IPO.It distributed a large amount of cash dividends at the end of 2016.This paper analyzes the huge amount of current distribution from the following aspects.First of all,the relevant concepts of dividend policy are reviewed,including the basic theory of dividend policy,dividend payment methods,basic types of dividend policy,and related theories of high current distribution dividend policy.Secondly,the theory is applied to the case.This article conducted a comprehensive analysis of Shenhua's dividend policy from the perspective of net profit,earnings per share,and net cash flow per share.Followed by a discussion of relevant factors affecting Shenhua's dividend policy,including financial factors and external(policies and industry related)factors.Then summed up the main motivation for Shenhua to conduct large-scale cash distribution.Through research,it is found that China Shenhua's huge cash distribution is mainly influenced by factors such as excellent financial status and reduction of investment opportunities caused by changes in the policy industry.The main motive is to increase the net assets return rate index and increase the leverage of financial leverage by reducing the amount of idle funds on the books,and it can feed back the capital needs of large shareholders.Finally,in the context of the CSRC's encouragement of cash dividends,it draws lessons from Shenhua's experiences and makes feasible suggestions on investors' investment decisions in selecting stocks of listed companies.