Research On Motivation And Effect Of The New Third Board Enterprises Transferring To The SSE STAR Market

Coinciding with China’s rapid economic growth,China’s capital market has presented a multi-tiered structure.The National Equities Exchange and Quotations(NEEQ,known as the New Third Board)plays a key role of connecting different capital markets.In the early day of the New Third Board,a large amounts of small and medium-sized enterprises raised development funds becoming high-quality enterprises.However,after 2015,many high-quality listed enterprises left the New Third Board due to the lack of liquidity and single financing channels.From 2007 to 2021,there are a huge number of enterprises from the New Third Board which successfully listed on higher-level capital market.On July 22,2019,the first group of 25 companies became listed for public trading on the SSE STAR Market and 4 of them were once listed on the New Third Board.By the end of 2021,99 New Third Board enterprises have successfully transferred to the SSE STAR Market accounting for 26% of the listed enterprises on the SSE STAR Market.This paper will research the case of Linkage software transferring from the New Third Board to the SSE STAR Market and analyze its motivation and effect,so as to provide experience for other enterprises listed on the New Third Board.Firstly,the paper states the research background and significance,and sorts out the previous research results of domestic and foreign literature.Secondly,this paper defines the concepts of the New Third Board and the SSE STAR Market.Besides,the paper resorts to the Efficient Market Hypothesis,Signal Transmission Theory and Financial Growth Cycle Theory.Thirdly,the paper compares the institutional differences between the New Third Board and other markets concluding the problems existing in the New Third Board,compares the existing transfer methods,and analyzes the current situation of the transferring on the New Third Board.Then,the paper focuses studying on the case of Linkage software.It sorts out the company’s listing process and analyzes the cost and key success factors of exchange listing.Moreover,the paper studies on the company’s motivation and the effect of transferring to the SSE STAR Market.Finally,this paper summarizes the previous research contents and draws several conclusions as follow: first,the New Third Board enterprises get rid of the Liquidity Dilemma by exchange listing;Second,enterprises obtain more financing;Third,the success of exchange listing is inseparable from the selection of appropriate board targets;Fourth,the cost of listing is still high up to now.In the end,through the in-depth research on the listing of Linkage software,this paper believes that there should be more improvement taken in the construction of capital market.Enterprises still need to treat the exchange listing rationally and keep improving governance.