The High Ratio Stock Dividend Behavior And Tunneling Of GEM Companies

The high ratio stock dividend policy has become a preferred method of distribution for listed companies in China's A-share market.In fact,high ratio stock dividend only reintegrates the company's internal rights.For enterprises,high transfer only expands the scale of equity.The advantage is that larger registered capital is a manifestation of strength,and the company can obtain bonds or equity conveniently in the future.However,with the increase in the number of companies proposing a high turnover in recent years,the dividend policy has become a major "dumper" in the capital market to a certain extent.The anti-state of high ratio stock dividend and the behavior of using high ratio stock dividend to conceal the tunneling of insider has also caused the government's supervisory departments to pay close attention.The GEM is a market with a high degree of market sentiment.This article selects Beixinyuan,which is a representative of GEM,as a case study object.It has been dubbed as"Dementor of stock dividend" because of the multi-year policy of sending high ratio stock dividends.Under the guidance of the second kind of agency theory,information asymmetry and catering theory,the article first analyzes the ability of stock dividend,the size of capital stock,the level of stock price level,and profitability,and found that the policy of sending high ratio stock dividend was unreasonable in Beixinyuan.When the capital reserve is inequacy,the use of additional issuance to meet the conditions for reversion,there is an impure motive,and the motive is related to personal interests.After integrating the institutional environment of China's capital market and the situation of Beixanyuan itself,we found out why high ratio stock dividend can easily help insiders achieve the purpose of benefit transfer,and we finally explore ways to realize the interests of large shareholders.The situation of Beixinyuan directly shows the major problems in China's A-share market.The government's involvement and continuous high-pressure supervision are inevitable.Investors also need to sort out the truth to understand the true face of opportunists,and prudent investments can help investors avoided reducing holding-shares in lowest price and benefit lost.