A Case Study On Capital Structure And Enterprise Value

Capital structure has been one of the core content of the financial management research.It has gone through a continuous process since the birth of the theory of capital structure,the core part of research has also removed from capital structure on corporate behavior to the direction of how corporate behavior affect the value of corporate.In a mature capital market,to achieve increased enterprise value,the listed companies must have a reasonable capital structure first.Therefore,it means a lot for listed corporate to figure out how capital structure affects enterprise value.This paper uses the capital structure theory and the case study method to figure out how the capital structure market an influence on the enterprise value.After describing the reason of choosing this research,this paper continues to present the relevant research on the capital structure and corporate value,and then starts to review the theory of capital structure to analyze and understand how the capital structure specifically affects the value of the firm in four ways.Next comes the very core of this paper,we select the Haier company for capital structure and enterprise value case study.Firstly,it analyzes the capital structure of Haier company in recent five years,and then to analyze how the variety of capital structure of Haier affects the value of the enterprise by using theories,and puts forward some suggestions on Haier's capital structure management.Haier's capital structure management recommendations are as follows: First,to maintain an appropriate debt equity ratio;Second,to raise the proportion of long-term debt;Third,to strengthen the restraint and encouragement for corporate managers;Forth,to combine the capital structure management with market competition strategy.