An Empirical Study On The Efficiency Of Seasoned Equity Offering Of Listed Companies Based On Corporate Life Cycle Theory

At present our country is in an important historical stage,and an active and expansivemarket economy is a necessary condition for it.As an important part of the market economy,from the perspective of investment funds,the seasoned equity offering will promote the rapid development of corporates.From the seasoned equity offering,the inefficiency of the free cash flow using would cause the problem of the management and the inefficiency of the seasoned equity offering,resulting in the loss of profits.So the study of the efficiency of seasoned equity offering is becoming more and more important in financial field in recent decades.In this paper,we will study the efficiency of seasoned equity offering of listed companies,which are at different stages of corporate life cycle,based on corporate life cycle theory.At the same time,the paper will study the relationship of equity refinancing of the seasoned equity offering and the investment which could cause the inefficiency of the seasoned equity offering.Overall,the study of this paper has an important value of reference to analysis the allocation of market resource and the efficiency of funds used by corporates,especially has an important value of the efficiency of seasoned equity offering caused by over-investment at different stages of the corporate life cycle.With the data of 612 listed companies of Shanghai and Shenzhen Stock Exchanges from2009 to 2015,this paper studies the efficiency of seasoned equity offering from the perspective of overinvestment based on corporate life cycle theory.The paper will use TE/TA to divide the stage of corporate life cycle,and use ROA,ROE and ROAEBIT to measure the efficiency of seasoned equity offering.By using the model of Richardson and Fama-French,the empirical results are as follows: the seasoned equity offering has the significantly positive impact on maturation degree of corporate,and the overinvestment will significantly lead to a decline in the performance after the seasoned equity offering,which show that the efficiency of seasoned equity offering is low.This paper will offer meaningful conclusions which can help the shareholders of listed companies to supervise.