Capital Structure Study Of Chinese Listed Electricity Power Companies

The issue of capital structure has been developed into a mature theory in the west countries, which lays the basis for this essay. But the foreign theory of capital structure is built on perfect management skeleton, developed capital market, and abundant capital resource. China has no such condition, so whether the foreign theory matches Chinese circumstance or not needs to be analyzed.Currently, most domestic scholars study all the listed companies as a whole, and usually draw different and sometimes even opposite conclusions. So we should make further analysis by other means and using different data. Further more, domestic scholars seldom take the electricity power companies as a sample.Because of the specialty and importance of the electricity power in the economy, this essay takes the electricity power companies in Shanghai and Shenzhen stock market as a sample. By the analysis of the characteristics of their capital structure, this essay tries to conclude the cause of the capital structure, and argue the range of the best capital structure. The essay will also give some suggestion of how to improve the capital structure and increase the profit.