Research On The Motivation And Economic Consequences Of Internet Enterprises' Shareholding In Securities Companies

With the development of Information Technology,Internet finance obtains fast progress,exerting great impact on traditional financial institutions.In this context,the securities industry begins to actively seek opportunities by the Internet technology in order to explore new development space.However,Internet companies have no direct access to the securities business for the limitation on financial certificates.Therefore,Internet enterprises starts to cooperate with securities companies to gain the “brokerage license” indirectly.With the increasing cooperation between the two sides,financial investment in Internet corporates emerges,such as Alibaba's shareholding in Huatai Securities,Tencent's stake in Futu Securities.Based on the perspectives from both sides,this thesis takes Alibaba's shareholding in Huatai Securities as the study objective.By means of qualitative and quantitative methods,this thesis probes into the motivation of Internet companies' stock admission into securities firms and the reasons why the latter introduces the former as strategic investors,and also analyzes the consequent economic influence on both sides from the market reactions,financial performances,non-financial performances and other aspects,so as to provide more empirical experience for the deeper cooperation between China's Internet enterprises and securities companies.Here are the discoveries of this thesis:(1)The primary purpose of Internet companies' taking a stake in securities companies is to obtain a securities business license indirectly,while the latter hopes to provide customers with more professional and personalized services by use of the big data analysis from Internet companies to transform wealth management.Through the targeted additional issuance,securities enterprises can also raise capital,adjust the business structure and improve their riskresistant ability and profitability.(2)By using the event research method to measure the market performance,we find that the market reacted positively to Huatai Securities' short-term market performance.However,as a result of Sino-US trade frictions,Alibaba's CAR kept negative during the period of measurement,while after its announcement of shareholding in Huatai Securities,its CAR rebounded,indicating that the market took a positive attitude to this event.In addition,via measuring BHAR,this essay finds this event increased the shareholder wealth of both sides,and the analysis of financial indicators shows the overall financial performance of the two companies has been improved,and the utilization ratio of assets keeps rising continuously due to the capital injection.In a word,this event not only brings Huatai Securities a large number of user traffic and organizational structure optimization,but also creates an opportunity for Alibaba to enter the securities industry.