A Study On The Behavior And Consequence Of Reducing Holding And Choosing Opportunity Of Major Shareholders Of Listed Companies

The original intention of China’s share structure reform is to solve the problem of interest balance between large shareholders and small shareholders in A-share market,enhance the vitality of the stock market,and promote the continuous development of China’s stock market.However,in the waves of reducing shares,the founders of listed companies have done a lot of actions,such as clearing their positions and reducing their holdings through bridges,which have passed a very negative impact on the market,causing stock market shocks and deviated from the original intention of the reform of the split share structure.Even in the wave of reduction,more controlling shareholders reduce their holdings to lose control,and the company’s equity is extremely scattered.In general,it is more difficult for a company to have no actual controller and its stock rights are extremely dispersed in corporate governance,which seriously hinders the development of the company.This paper selects Tianguang Zhongmao as a case,which is a company with continuous reduction of large shareholders.Based on the effective market theory,information asymmetry theory,market timing theory and liquidity premium theory,this paper studies the timing behavior and consequences of large shareholders’ reduction.First of all,we sort out the situation of large shareholders’ holding reduction in Tianguang Zhongmao company by stages,and analyze the timing behavior of each reduction stage qualitatively through the market performance announced before the reduction.On this basis,we use the liquidity premium theory and residual income valuation model to quantitatively analyze the profit level of major shareholders by reducing holding and selecting opportunities.Secondly,through the comparison with Tobin Q value of the industry,this paper studies the impact of the reduction on the enterprise value,and further uses Z-score Model to study the financial risk level of the large shareholders after the reduction.At last,we use the event study method to analyze the short-term market reaction of the large shareholders’ reduction in Tianguang Zhongmao,and choose the index of earnings per share and net assets per share to compare with the industry average value to explore the damage degree of minority shareholders’ equity.The results show that: there is an opportunistic behavior in the reduction of large shareholders,and the effect of different ways of reduction on the cumulative excess return is different.The reduction of large transactions is generally a negative effect,while strategic reduction will bring a short-term positive effect.All in all,the reduction of large shareholders will reduce the value of the enterprise,aggravate the financial risk of the enterprise and the fluctuation of the capital market,and erode the interests of small and medium shareholders.In the end,this paper puts forward suggestions from three aspects: information disclosure of major shareholders,corporate governance and protection of the rights and interests of small and medium-sized shareholders,hoping to strengthen the regulation of shareholders’ reduction behavior of listed companies and create a good and orderly capital market atmosphere.