Impact Of China's Private Listed Companies' Capital Structure Factors

Based on a sample of 151 Chinese private-owned listed companies in 2005, the paper firstly makes an empirical analysis on the capital structure by comparative method. There are several significant features of the capital structure of Chinese private-owned listed companies: First, the general level of the debt-to-asset ratio is low while it has a rising trend during 1993-2005; Second, the long-term development of enterprises mainly depend on equity finance resulting in the low level of long term debt; furthermore, too much current liability such as short-term debt, account payable, notes payable contained in enterprises which is apt to inducing financial risk.Then effevtive factors of the capital structure are selected by SPSS software under the multi-line regression analysis method, at the same time a comparison is made between Chinese private-owned listed companies and stated-owned listed companies. Eight factors have great effect on the debt-to-assets ratio of Chinese private-owned listed companies, such as the scale, collateral value of assets, retained earning ratio, non-debt tax shield, roe, WACC, current ratio, turnover of total assets; While only collateral value of assets and growth rate have obvious effect on the long-term debt to assets ratio of Chinese private-owned listed companies, which is different from the stated-owned listed companies. The differences are mainly induced by the different debt financing environment faced by Chinese private-owned and stated-owned listed companiesFinally, the paper puts forward suggestions on how to optimize the capital structure of Chinese private-owned listed companies.