Equity Concentration, Debt Financing And Corporate Performance

The emergence of MM theory,1958 marks the birth of modern capital structure theory,after around the study of capital structure theory emerge in endlessly,financial experts constantly explore equity structure,the relationship between debt structure and corporate performance to determine the optimal capital structure.Domestic and foreign scholars have conducted extensive research on equity concentration,debt financing and corporate performance,and achieved many results,but most of the research is aimed at only one industry.Because different industries have different competitive environment,the impact of equity concentration and debt financing on corporate performance is different.Therefore,it is of great practical significance to further study this topic from the perspective of industry competition attribute.In this paper,according to the industry classification guidance of listed companies in China divided into 22 industries,choose market competition has bigger difference extractive industries and information technology as the research object,the extractive industries competition on behalf of the monopoly industry and information technology on behalf of the perfectly competitive industry.On the basis of collecting sample data from 2012 to 2016,the shareholding ratio of the top 10 shareholders was measured in terms of equity concentration,and corporate performance was measured by return on equity.Debt financing from the overall level of debt,debt maturity structure and debt sources structure considering three angles of ownership concentration,the relationship between debt financing and corporate performance has carried on the regression analysis.The results show that the ownership concentration of extractive industry is inversely related to corporate performance,and the concentration degree of information technology industry is positively correlated with corporate performance.In terms of the overall level of debt,the asset-liability ratio of the extractive industry and the corporate performance are inverted u-shaped,and the asset-liability ratio of the information technology industry is positively correlated with the company’s performance.In terms of debt maturity structure,short-term debt of mining industry is positively correlated with corporate performance,and long-term debt is negatively correlated with corporate performance.The short-term debt of information technology industry is negatively correlated with corporate performance and long-term debt is positively correlated with corporate performance.Debt sources,extractive industries bank credit negative correlation with corporate performance,and bank credit in the information technology industry positive correlation with corporate performance,commercial credit in extractive industries positively related with information technology and corporate performance.Therefore,the competition degree of the industry is different,and the requirements on the structure of equity structure and debt structure are different.Based on the empirical results,this paper gives full play to the role of shareholders in corporate governance.Establishing a moderate shareholding structure based on industry competition degree;Optimize the financing structure according to the industry characteristics;We will reduce the cost of debt financing and improve the debt market.