A Study On The Relationship Between The Capital Structure And The Performance Of The Private Listed Companies In China

Reasonable capital structure will standardize business practices, improve corporate value; unreasonable capital structure will cause dislocation of corporate behavior, decline in companies value. The distortion of capital structure has been thought that it should be responsible for the low efficiency of operating performance of Chinese Private listed companies in theory researching as well as in practical operation. Hence researches on the relationship between capital structure and operating performance have attracted numerous researchers'interest and become important task with widespread concerns. Private listed companies as a leader in private enterprise, represent the orientation of private enterprises. The study on the relationship between capital structure and performance of Private listed companies in China has important practical significance, not only in improving the further development of private enterprises, but also in restructuring the performance of private enterprises.First of all, this paper analyzes the status of current research and the related basic theories at home and abroad, then combined with the capital structure and performance of the current situation of China's private listed companies, we make the empirical analysis of the correlation between them reveals the inner link of our current economic state. In this paper, we choose the Annual Report of Listed Companies from 2007 to 2009 as the sample data, asset-liability ratio as explanatory variables, factor analysis Derived from the evaluation of performance indicators as the explanatory variables.conduct a linear regression and quadratic regression in different years and different industries respectively, we get the following conclusions after the situation analysis and empirical research:First, China's private listed companies in capital structure and performance negatively correlated, that is, the higher the debt ratio the lower the performance of enterprises; Second, the relationship between capital structure and performance vary for different industries; Third, China's private listed company's capital structure have the low proportion of long-term debt and they preferred equity financing.Based on the above conclusions we propose some suggestions:Actively develop the corporate bond market and encourage private listed companies raise funds from various sources; promote the listing of private enterprises and optimize the internal governance structure of listed companies private; Constantly improve the performance evaluation system of private listed companies.