Effect Of Unsystematic Factor On A-B Share Discount Of Cross-listing Companies

B share price discount against A share is a common phenomenon in dual-listing shares in Chinese market,which has been well studied by both domestic and foreign scholars.However,most research focuses on the systematic factors of A-B share price difference.and has formed several mature theories such as main investors difference hypothesis,liquidity difference hypothesis,demand elasticity difference hypothesis and information asymmetry hypothesis.However,after February 2001 when domestic investors were allowed to invest in B share market,the investment environment,main investers and investment methodology in B share market has significantly changed.Therefore,through combining nowadays specific economic background,we further study the unsystematic factor of A-B share price difference,including dual-listing companys' equity concentration,profitability,equity cash flow and quality accounting disclosure.So that we can provide more suggestions on narrowing differences between A and B shares,promoting merger of A and B share market.This thesis takes 82 A-B dual listed companies as the research object,uses related variables from annual report between 2013-2015 as the sample data,and constructs empirical models to verify unsystematic factors on the A-B share price discount of dual listed companies.This thesis finds that equity cash flow and quality of accounting disclosure make significantly negative impact on A-B shares price discount.In other words,more abundant the equity cash flow and higher the quality of accounting information disclosure,smaller the A-B share price difference.In addition,the empirical results show that the influence of equity concentration on A-B share price difference is not significant.To promote merger of A and B share market,we suggest that regulators standardize and improve the accounting information disclosure to guide B share investors,support dual listed companies repurchase B shares by issuing A shares to alleviate the pressure from cash shortage;Dual listed companies should improve earnings quality,take positive cash dividend policy to inspire investors,improve the number and quality of accounting information disclosure to reduce A-B share price difference to prepare for the merger of B shares and effective refinancing.Investors should pay more attention to disclosure released by companies combined with professional research report and focus on fundamentals.