Research On The Motivation And Effect Of CRCHI’s Spin-off And Listing

With the gradual improvement of China’s capital market,China began to establish a science and technology board and pilot a registration system in 2019,and the openness and inclusiveness of science and technology companies have been further enhanced.At the same time,the China Securities Regulatory Commission(CSRC)issued Several Regulations on the Domestic Listing Pilot of Listed Companies’ spin-off Subsidiaries,clarifying the standards and procedures for the domestic spin-off listing of A-shares,providing institutional guarantee and policy support for the spin-off listing of domestic listed companies.As an important means to optimize the allocation of resources in the capital market,spin-off and listing can broaden financing channels,improve cash flow and enhance the overall market value of the company,which is conducive to the professional operation of the core business.The reduction of the threshold of spin-off listing has greatly increased the number of enterprises that meet the requirements for spin-off listing,and domestic diversified group companies have put the spin-off listing plan on the agenda to eliminate the "negative synergies" brought by diversification through spin-off listing.This paper takes the spin-off of China Railway Construction Corporation(CRCC)as the case study object,and uses case analysis,literature review and event study to study the spin-off listing from multiple angles.Firstly,this paper reviews the relevant domestic and foreign literature on the demerger listing motivation and the demerger listing effect.Secondly,it introduces the background of the demerger listing and the specific process of the demerger listing.Thirdly,combined with the four motivations of the demerger listing,the effect of the demerger listing is studied one by one.This paper analyzes the effect of the spin-off listing of the Railway Construction Construction Industry from four perspectives: financing situation,market value,financial index and strategic effect,and analyzes the reasons for the difference between the actual effect and the expected effect.After the research,the conclusions are as follows: from the perspective of financing situation,spin-off and listing broadens the financing channels of enterprises and relieves the pressure of the parent company to provide funds for subsidiaries;From the perspective of market reaction,the market value of enterprises after the split will increase in the short term,but the long-term positive effect is not obvious;From the perspective of financial indicators,the profitability and debt paying ability of China Railway Construction Heavy Industry have been improved after the spin-off and listing,and it has gained sustainable growth ability.In the short term,the spin-off and listing will bring good performance to China Railway Construction Heavy Industry.From the strategic perspective,after the spin-off and listing of enterprises can be more focused on the professional operation of core business;After the spin-off,a large amount of capital is invested in R&D and innovation,so that the R&D and innovation ability of enterprises is constantly improved.After the spin-off,the overseas market share of the enterprise has increased,and the domestic and overseas markets have been developed.Finally,the paper summarizes the research conclusions and puts forward specific suggestions for the subsequent spin-off listed enterprises,hoping that this case can provide reference for the companies who intend to spin-off and list on the Science and Technology Innovation board.