The Motivation And Effect Analysis Of G Game Company’s High Cash Dividend Distribution

Cash dividends are the most common type of dividend policy.Before 2000,the dividend policies of listed companies in China were mostly based on transfers and bonus shares.However,after 2000,cash dividends were selected under the guidance of the CSRC’s policies.The substantial increase in the number of listed companies has made the phenomenon of "high cash flow" in the capital market increasingly prominent,which has drawn the attention of scholars,and has conducted in-depth investigations on the definition of high cash flow and influential factors.Based on this phenomenon,this article selects the typical G game company in the case of "high pay cash" as a case,analyzes the motivation and market response of G game companies to maintain high cash dividend policies,and finds the cash dividend of G game companies.Existing policy problems and make corresponding suggestions.This article first introduces the background and sorts out the relevant literature of "high-end cash" at home and abroad.Secondly,it summarizes the relevant theories of "high-end cash" : signal transmission theory,principal-agent theory,etc.,and then analyzes the "cash dividend" phenomenon of listed companies;then it briefly introduces and summarizes the background of G game companies The characteristics of its dividend distribution policy and the in-depth analysis and exploration of the reasons for G Game Company’s "high payout".Finally,it focuses on the causes and problems of G Game Company’s "high pay cash",and puts forward corresponding suggestions for its cash dividend policy.The research in this paper concludes that the main motivations behind G Gaming’s high distribution are:(1)the controlling shareholder of G Game Company to quickly recover the investment cost;(2)G Game Company currently does not have a suitable investment project;(3)G Game Company to reduce the second The type of agency cost is currently in line with the life cycle of the company;(4)G Game Company uses cash dividends to convey the company’s good development signal,and continues to carry out high cash out of the preference of catering to investment.However,there is no sufficient evidence to prove that the two motivations of major shareholders infringing on small shareholders and meeting the policies of the CSRC to obtain refinancing requirements.Besides,through the event research method,this article finds that G Games’ " high cash" behavior sends a positive signal to the market.The company’s financial indicators are higher than the industry average,and it also verifies that the company is catering to investment.Preferences continue to be high cash.But we also need to be alert to the risk that the company’s financial flexibility will decline after the majority of G Game’s cash is distributed through dividends.