Analysis Of On Affecting Factors Of Cash Dividend For Listed Companies In Liquor Industry

Cash dividend policy has been the concern of scholars at home and abroad, it is not only the continuation of company’s investment and financing activities, but an important means of capital allocation.Furthermore,it is an important financial strategy that regulates the stock price and balances interests of all parties. All in all, it is the inevitable result of the company’s financial behavior. Reasonable cash dividend policies are conducive to stabilize company’s share price, to balance the interest between different groups of shareholders, to help enterprises establish a good corporate image, to stimulate the investment enthusiasm of investors, thus, it can continuously make listed companies a healthy and stable development. However, due to the late development of China’s securities market, the largest shareholder is relatively concentrated, resulting in many problems in cash dividend among China’s listed companies. Asit can be seen from past research, the problem mainly in the following aspects:First of all, there is numerous dividend allocation methods,but the proportion of cash dividend is so small;Secondly, some listed companies is called "Iron Cock " that they even do not allocate dividend for many years;In the meantime, the procedure of cash dividend lacks continuity and stability; What’s more, cash dividend policy is dominated by large shareholders who have great influences on cash dividend.As previously described,all this lead speculation behavior of investors, thus, value investment and long-term investment philosophy will never form as well.In this regards, the SFC promulgated a series of laws and regulations to regulate the behavior on cash dividend of listed companies from the end of 2000, which make cash dividend a necessary condition for refinancing activities of listed companies. Such as Methods of IPO for Listed Companies in 2003,which clearly state that if the listed company do not allocate cash dividends and dividends for the last three years and the board of directors give no clear and reasonable explanations in the situation of refinancing, the lead underwriter of securities companies should pay attention to this and describe it in the survey report. In October 2008, the SFC issued regulations on amending some previous rule of cash dividends of listed companies which require detailed disclosure of cash dividend policy in annual reportand in the situation of refinancing, cash dividend should be at least the average annual 30% of profits available for distribution for the last three years. However, these measures made no one satisfactory, semi-mandatory dividend policy worked in the short term only, listed companies who refinanced even experienced great fluctuations of cash flow and appeared signs of manipulation. Regulators simply require listed companies to strengthen cash dividend and link refinancing measures to cash dividend,which can’t regulate the dividend behavior of listed company suitably. Therefore, only by deeply research of specific factors that affect the distribution of cash dividends.can we solve the problem fundamentally. Liquor industry as China’s traditional industries, has a long historyand rich culture. Since the reform and opening up, China’s liquor industry has made tremendous development and great changes. In the same time, we have a variety of tax items, higher tax rates,especially consumption tax for white liquor product. From the perspective of tax law, tax revenue in liquor industry contributesmuch to the development of our national economy and plays an important role in the country’s major sources of financial revenue. However, beginning in 2012, with slowdown of national economy,coupled with restrictions on consumption of servants andissuance of prohibition policy, even "Plasticizer Event" included, which have a serious impact on market confidence.Thus, sales of liquor products were down, profitability of liquor companies decreased, the share price of liquor companiesalso began to fall, shareholders wealth reduced. All of this are bound to have good impact on the liquor industry’s cash dividend policy, so affecting factors of cash dividend research in liquor industry is important. Currently theorists have small research on affecting factors of cash dividend for listed companies in the liquor industry,even a small amount of research which only limit to the company’s characteristic angle.By means of empirical methods, the article studies influence factors on cash dividend of liquor industry from angles of features of company, corporate governance, industry characteristics, hoping to give some meaningful guidance on cash dividends policy of listed companies in liquor industry.To research on affecting factors of cash dividend for listed companies in the liquor industry specifically,the article carries it out systematically from both theoretical and empirical. First, it theoretically specifically analyze affecting factors of liquor industry form external such as legal environment, market speculation and internal such as profitability, debt levels, company size and so on. Then it selects 10 variables using principal component analysis and factor analysis combination by sample from 2009 to 2013 in Shanghai and Shenzhen listed companies in the liquor industry, and finally put forward some recommendations based on empirical conclusions. Total article is divided into six parts:the first part introduces the research background and significance of the topic, review of relevant research literature, main content and research methods; the second part describes the basic theory of dividend policy, first introduce dividend policy and its related concepts, then detail elaborate two dividend mainstream theory from traditional and modern to provide a theoretical support for the full deployment; the third part, detail introduce cash dividend situation of listed companies in liquor industry, first introduce the development and characteristics of cash dividend distribution of listed companies in liquor industry following theoretically analyze affecting factors of cash dividend in liquor industry form external and internal; The fourth part selects 10 variables form external and internal by principal component analysis and factor analysis combination methods to analyze affecting factors of cash dividend policy in liquor industry, and then based on empirical conclusions,it propose some practical and valuable proposal; the fifth part, according to the situation of listed companies in liquor industries and empirical conclusion it put forward, this article suggest that we should cultivate institutional investors, make cash dividend policy standards,focus on improving the profitability of companies etc.Finally, it is the Conclusion.