The Research On Enterprises Group And Efficiency Of Investment

Investment decisions plays the most important role in the three major financial decisions of the listedcompany, an efficient investment is the driving force for sustainable development and an importantfoundation for future cash flow growth. Therefore, for the efficiency of investment research has long beenattracting attention of academics and practitioners. In emerging markets countries,industrial groups hasgradually become a very popular form of organization(Khanna and Palepu,1997),and in recent years, withthe rise of corporate diversification strategy and the increasingly frequent mergers and acquisitions, Chinahas also emerged a large number of industrial groups and gradually become a popular form of organization.Diversification of industrial groups and the construction of internal capital markets are able tocomplementary and alternative the inefficient external capital markets in order to achieve the advantageconfiguration of groups’ resources, ease financing constraints, improve the competitiveness of enterprisesinvestment to produce a certain impact on the efficiency of investment companies. The agency problemassociated with the establishment of the internal capital market will lead to the interests of small investor isunfair looted by the major shareholders, making the industrial groups becomes a tool for listed company’scontrolling shareholder to "emptying" the interests of minority shareholders, exacerbated the agency costs,which further impact on the efficiency of investment. Therefore, the efficiency of the company’s investmenthas a certain uniqueness, but also heavy and difficult issues of academic research at home and abroad.In this paper, a systematic review of the basis of the relevant research literature at home and abroad,using the data of the Shanghai and Shenzhen A-share listed companies from2008-2012as samples, fromthe perspective of the Group’s diversification and internal capital market efficiency departure, and to studythe relationship between the listed group of companies operating efficiency and investment between thebinding nature of the ultimate controller of the property.The main conclusions are as follows:1. Compared with an independent company, the higher investment efficiency the group managementhave.2. Diversified group of operating companies’ higher degree, the more effective the internal capitalmarket, the higher the efficiency of investment. By adopting diversification strategies to enhance the role ofinternal capital markets play space and improve the efficiency of internal capital markets can effectivelyimprove the company’s investment efficiency, space and efficiency of investment efficiency visible groupof companies to build their internal capital markets are inextricably linked.3. In the group of operating companies as samples, based on the different nature of the ultimatecontrolling ownership of the operating companies of the Group’s investment efficiency further tests, theresults show that, compared with the private nature of the company, the nature of the investment efficiencyof state-owned group of companies is significantly lower and compared to the local government-ownedgroup of companies controlled by the investment efficiency of state-owned group of companies controlledby the central government was significantly higher. However, the nature of the relationship between the fullsample analysis and the efficiency of investment property as well as the group of operating companies assamples and through the internal capital market efficiency and the degree of diversification and the natureof property rights for further cross-examination found that the nature of property rights and no internalcapital impact on the relationship between the degree of market efficiency and the diversification ofinvestment efficiency, and in the full sample analysis carried out, the relationship between the company and the nature of property rights only efficiency and investment between the results for the samples testedare substantially the same. This shows the nature of the impact on the Group’s property investments maynot be efficient because the Group operations and cause, but the phenomenon of listed companies inChina’s general investment efficiency.4. In addition, the relationship between the value of the Group’s operations and business expansion testfound that the Group of the mode of operation to help enhance corporate value, and the higher the degree ofdiversification, the more effective the internal capital market, the more business value high.Therefore, the strengthening of the Group’s operating companies to manage and further realization:standardization group investment, integration, the establishment of effective decision-making and scientificmanagement of investment risk prevention mechanism, give full play to the role of internal capital markets,improve efficiency while achieving enhance corporate value, and strive to achieve the state-owned andprivate, central and local synchronous development, it is particularly important.