Study On The Economic Influence Of Stock Pledge Of Controlling Shareholders Of Listed Companies

In practical application,equity pledge has become a new financing method and developed rapidly because of its advantages of easy operation and low cost of wind control.Among them,the controlling shareholders pledge is the main one.Because the shareholders who pledge the shares have special status and rights in the company,it will affect the listed companies,so it causes research about the relationship between equity pledge and company performance and value.In recent years,the risk of equity pledge market is frequent in China.In order to strengthen the control of equity pledge market,regulate the behavior of market participants,and protect the rights and interests of stakeholders,it is necessary to explore shareholders’ equity pledge behavior and its economic impact.This paper takes Huachangda Intelligent Equipment Group Co.,Ltd.as a case study enterprise,using the methods of literature analysis,stock return calculation,economic value added calculation,financial index calculation and so on.By sorting out the relevant literature at home and abroad,this paper summarizes the mechanism of equity pledge affecting listed companies and the manifestations of the results,and determines the direction and theoretical basis of case analysis.In the case analysis part,the author first introduces the company’s ownership structure and governance structure,and then analyses the characteristics and motivation of the pledge combined with the specific situation of the major shareholders’ equity pledge.Then we analyze its economic impact from four aspects,including: calculating the short-term holding returns of stocks reflected by the cumulative excess returns on different announcement days and periods;long-term holding returns reflected by the annual returns of stocks,quarterly returns and dividends on the holding period;calculating the economic added value to reflect the changes of the company’s value;calculating the index of the company’s solvency and analyzing the net cash flow of the operation to illustrate changes in the company’s financial position.The results show that the main shareholders’ equity pledge behavior in this case is mainly due to their own capital needs.During the period of equity pledge,the short-term stock holding returns are not significantly affected,while the long-term returns are negatively affected.This indicates that for non-controlling shareholders and other small and medium-sized investors,more attention should be paid to long-term returns and investment strategies should be adjusted to avoid risks.Economic value added has experienced the change of decreasing first and then rising.Combined with the change of pledge scale,it shows that the company’s ability to create value is negatively affected in the process of increasing the pledge scale,and when the pledge scale stops increasing,the company’s value rebounds;the short-term solvency is lower than the industry average level,the long-term solvency continues to decline,the profit margin is lower,and the cash flow is scarce,which indicating that the financial situation is negatively affected,creditors need to consider carefully lending to their listed companies.