| Raising funds is one of the basic functions of security market. As the main body of the market, listed companies may want to raise money again after the initial public offerings (IPO), for the industrial development or capital operation. Thus refinancing is the best choice. Refinancing is more and more important financing channel of listed company. However, it has also brought some problems and negative effect to our stock market. Investigating the stock price effect of refinancing is helpful in understanding and evaluating every financing method appropriately, meaningful in both realizing the short-term stock price impact of it and bettering our capital market.Based on the refinancing price effect theory, this paper carries through in-depth discussion about actuality, problem and cause of refinancing of listed company of China. Standing on domestic development of refinancing, this paper brings out a series of research hypothesis. And applying event study methodology, we study thirty-five samples cases to establish thirty-two regression equations, this paper interprets measures and analyzes the abnormal returns of all samples on the refinancing announcement day, samples from Shanghai stock market and Shenzhen stock market, respectively in 2004. Such statistical regression analysis will enable us to realistically evaluate listed company's share refinancing initiatives, the practical implications of refinancing, as well as the effect that news of refinancing has on the performance of a listed company's share price before and after the news is released to the public. Then this paper carries on comparative analysis of stock price trend influence which has been caused by SEO, rationing shares or transferable bond. Based on analysis, we make the conclusion that market identifies with refinancing little. Finally, in view of theory analysis and demonstration research, this paper brings forward suitable advices to government, listed company and investors. |
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