A Study On Motivation Of Low Cash Dividend Distribution Policy

As a main form of return to investors in the stock market,the cash dividends did not get a positive response in China.No dividend of listed companies meet the eye everywhere.Dividend payout ratio is too low,"miser" phenomenon can be seen everywhere.In order to protect the interests of small investors in 2012,the Commission issued "on the further implementation of the relevant matters of cash dividends of listed companies notice",published "regulatory guidelines listed companies third,cash dividends of Listed Companies Commission Notice No.[2013]43" in 2013,and later gradually introduced a series of documents on cash dividend distribution of listed companies and regulatory attention continued promotion,February 5,2018,Shanghai held cash dividends of listed companies will show special instructions,regulators encourage and supervise the cash dividend from the principle of "knowing" to implement the specific "line".With the implementation of various policies and measures,the stability and sustainability of the cash dividends of Listed Companies in China have improved.In spite of this,there are still many companies that have low dividends in recent years or even out of cash for a variety of reasons.Based on this,this paper will take Tongceyiliao as a case,analyze the reason for not paying cash dividends in a long term and comprehensively evaluate whether this strategy is reasonable.In order to make research on the motivation and the rationality of Chinese stock market "miser" phenomenon.This research is determined on analysing whether the company dividends have the ability firstly.Then based on the theory of enterprise life cycle and dividend agency cost theory,specific analysing the reason for no cash dividends,and identify the core motivation from the objective constraints and subjective causes two aspects.At last,give a comprehensive evaluation and rationality of the dividend policy.First of all,the study found that,Tongceyiliao profitability is higher than the industry average.Cash conversion ability does not have obvious problems.Debt ratio is at a healthy level and have the ability to cash dividends but does not meet the conditions of artificial control of cash dividends of listed companies.Secondly,the industry is in the period of expansion.The company is in the growth stage and needs keep some liquidity reserves.No cash dividends have its objective constraints;however,this study found that the core factor of company cash dividend is not human motivation and is the actual control of listed company executives or exist in their own interests as the starting point.Then set the specific transaction structure to circumvent the cash dividend regulatory policy traces listed companies,legal compliance not dividends,executives led by the actual control of the benefit from and given the Topchoice The low leverage rate of medical care has not been motivated by cash dividends to qualify for refinancing.Thirdly,from the three aspects of small and medium-sized shareholder return,investment project return and enterprise value.It is reasonable for management to not pay cash dividends.Although there is no lack of discussion about cash dividend distribution policy in most theories,most of them are empirical studies.Different from previous studies,this paper adopts the case study method to take into account some factors that can not be described by variables in empirical research,which helps to interpret "the puzzle of Chinese stock market" and provides a reference for future related research.And this paper makes a comprehensive evaluation of the rationality of the dividend distribution policy of the case company,and also provides more reference for the dividend distribution practice of the company.