Research On The Financial Leverage Effect Of China’s Manufacturing Listed Companies

Manufacturing industry is the main body of a country’s economy and the core industry that the country needs larger capital investment.Usually,financial leverage is needed to finance.In order to keep the manufacturing sector stable,it is necessary to maintain the level of financial leverage and prevent the blind expansion of liabilities;but business operators and investors may push high leverage at any time out of consideration of liquidity,or in pursuit of leveraged earnings.That is to say,from the point of view of manufacturing enterprises,leverage ratio is a result of resource allocation of enterprises.The moderate leverage ratio needs to consider the financial leverage effect of different enterprises and different situations.When the financial leverage effect is negative,it is necessary to consider the case of the high lever and negative benefit,and it is necessary to reduce the leverage.And when the financial leverage has positive effect,the higher lever rate can bring the benefit to the enterprise.Therefore,the key to study the appropriate leverage level of manufacturing industry is to observe its financial leverage effect.The financial leverage effect is only a ruler to measure the degree of leverage of the enterprise.We should dig into the factors that affect the financial leverage effect,and provide a reference for the enterprise to adjust the leverage ratio,so as to achieve a more rational resource allocation goal.On the basis of the classical capital structure theory and the relevant empirical analysis at home and abroad,this paper takes the financial data of 625 manufacturing enterprises as samples to make an empirical analysis on the financial leverage effect and the factors affecting the financial leverage effect.The results show that the agricultural and sideline food processing in our manufacturing industry.The financial leverage effect of industry,food manufacturing industry,wine,beverage and refined tea manufacturing industry has not come into play;textile industry,textile and clothing,clothing industry,leather,fur,feather and its products and footwear industry have more significant negative financial leverage effect,wood processing and wood,bamboo,rattan,brown,and so on.There is a positive effect of financial leverage in the industries of grass products,furniture manufacturing,paper making and paper making industry,and the financial leverage of other manufacturing industries has negative effects.After empirical analysis of the degree of influence of influencing factors on the leverage ratio of enterprises in various industries,it is found that there is a significant positive correlation between the scale of companies in agricultural and sideline food processing industries and the leverage ratio of enterprises,and the tax avoidance effect of non-debt tax shields in textile industries and other industries is poor,while asset liquidity in most industries is poor and debt paying ability is weak.Finally,combining the empirical analysis of financial leverage effect and the empirical analysis of influencing financial leverage factors,it is suggested that manufacturing enterprises should treat enterprise leverage ratio differently,choose diversified financing ways,improve capital liquidity and establish effective monitoring system.