The Impact Of Equity Incentive In OTC Market On Finance Performance Of The RH Company

Equity incentive originated from western countries and has matured in China in recent years.In 2019,the Party Committee of the China Securities Regulatory Commission will include the reform of the new OTC market into the key task of comprehensively deepening the capital market reform.However,the development of equity incentive in new OTC market is in the initial stage.Therefore,equity incentive will become the urgent need of the listed companies of the new OTC market,and the research on equity incentive of the new OTC market has important significance.This paper uses literature review method to study the influence of equity incentive and financial performance with incentive theory,principal-agent theory,interest-related theory and capital structure theory as the main ideas.Using the case study method,this paper studies the equity incentive of RH company listed on the new 3rd board as a case,and analyzes its relevant impact on financial performance.Through comparative analysis,the equity incentive schemes of RH company in various years are compared,and the influence of equity incentive on traditional financial performance and non-traditional financial performance is compared respectively.Through data analysis,this paper studies the impact of equity incentive on specific financial performance indicators.Finally,through case analysis,suggestions and enlightenment are put forward on the problems arising from the equity incentive of RH company.Through research,this paper finds that the equity incentive of RH company has no great influence on economic added value and profitability,and the reason for the profit decline is mainly the lack of funds in the development stage of the company.However,equity incentive has improved the company's debt paying ability and the company's operation development ability by a small margin.At the same time,equity incentive increases the company's debt financing and keeps the company's market value high,which indicates that through equity incentive.