The Motivation And Effect Of Privatization Regressin Of China Concept Stock

At the beginning of the development of China's capital market,there are many imperfections making some enterprises unable to meet the financing needs in the domestic capital market.Those enterprises have turned to the overseas market,whereupon a large number of China concept stock enterprises emerged.At the beginning of entering the overseas market,China concept stock enterprises were recognized by American investors and met their financial demand.However,there is a huge cultural difference between China and the United States.There is an insurmountable gap between local laws and regulations and investors' ideas.Especially after 2010,Many China concept stock enterprises have been short-selled by professional institutions,and their stock prices have continued to decline,showing a downturn,and they have been unable to meet their own financial demand.With the gradual improvement of capital market in our country,some Chinese enterprises began to choose privatization delisting and return to the A-share market.Therefore,this paper tries to analyze the case of China concept stock regression and study the motivation and effect of China concept stock enterprises' regression.Through the literature analysis,case study method,event study and financial index analysis,this paper analyzes the causes and effects of JA solar's privatization delisting and return to the A-share market,hoping to provide some suggestions for other Chinese companies and the improvement of Chinese capital market.First,through the literature research method,the content of the motivation for the return of Chinese stocks,the research related to backdoor listings,and the effects of the privatization return of China concept stock enterprises were sorted out;Secondly,it defines the concepts of China Concept Stock,VIE structure,privatization of listed companies and shell resources,analyzes and sorts out the theory of equity financing,underestimation and transaction costs,and then analyzes the trends and ways of the return of China Concept Stock Enterprises.It has a comprehensive understanding of related concepts and theoretical basis.Then,the paper introduces the basic situation of both parties in the privatization return case of JA solar company and the process of JA solar's return by case analysis.In addition,the reasons for JA solar's privatization and delisting as well as the reasons for its successful backwardation and return to the A-share market were analyzed,and it was concluded that JA solar's privatization and delisting were due to the serious undervaluation of the enterprise value and high listing maintenance costs,plus the support of national policies for the development of the photovoltaic industry;The reason why JA Solar could successfully return to the A-share market is because it found a suitable shell resource and domestic policies have relaxed the restrictions on backdoor listing.Then,the event study method was used to analyze the short-term effects of JA solar's return,and it was believed that it did produce a positive market effect but did not last long;Through comparative analysis of financial indicators,it is found that JA Solar maintains good profitability and development capacity after the return,but the solvency still needs to be strengthened;In addition,the return to the A-share market has also reduced the company's listing costs and increased production capacity.Finally,by summarizing the case,the experience is extended to all Chinese concepts stock enterprises,It is believed that when facing privatization choices,enterprises should remain rational,make reasonable and clear corporate positioning according to their own development strategies,and at the same time formulate reasonable privatization prices and timely grasp the development trend of national policies to reduce the failure of privatization risk..And from the comparison of the Chinese and American capital markets,the corresponding suggestions for the reform and development of China's capital market are put forward,and we believe that China should continuously improve and develop a multi-tier capital market system,supports more high-quality Chinese stock companies to innovate their return methods,and strictly enforces the delisting system to optimize market resource allocation.