A Study On The Influencing Factors Of The Return Rate Of Private Placement Of A-Share Listed Companies

Since 2006,private placement has been the main refinancing method of A-share listed companies in China.With its low financial requirements,flexible issuing methods and high financing efficiency,it has been widely welcomed by listed companies.Generally speaking,directional issuance is also understood as good news by the capital market.The stock prices of the corresponding companies are often boosted to a certain extent,thus enabling investors to participate in additional issuance to obtain higher returns.In addition,in the issuance stage,there is usually a considerable subscription discount for the institutions,which can produce excess returns far higher than the market benchmark by adding the price increase during the lock-in period.Therefore,the directional issuance of listed companies has become a more enthusiastic project for investors.So,what factors will affect the rate of return? What criteria should institutions and individuals adopt when screening projects in order to have a better probability of obtaining excess returns? At present,there is no definite answer to these questions in academia and financial circles.On the basis of previous studies,this paper finds out some potential factors that may affect the rate of return through theoretical analysis.At the same time,it divides the rate of return of directional issuance into two parts: the discount rate of return of issuance period and the rate of return of lock-in period,and also studies the overall comprehensive rate of return and the excess rate of return.Specifically,the author established a model and the relevant data of directional issuance in A-share market from 2006 to 2017 are taken as samples.Descriptive statistics,correlation test and regression analysis are carried out on the dependent variables(above four rate of return)and independent variables(several potential influencing factors).Finally,the following conclusions are drawn:(1)Firm size、age and ownership concentration level will not affect rate of return at all,but the return on investment of state-owned enterprise project is significantly higher than that of private listed companies;(2)the return on projects involving large-scale powerful institutions is significantly higher than that on projects without such institutions,while the stock-holding proportion of ordinary institutional investors has no effect on the return on investment;(3)There is a significant negative correlation between the return on total assets and discount rate of return,that is,the stronger the profitability,the smaller the discount magnitude,but it has no substantial impact on the yield of lock-in period;financial risk has no significant impact on the rate of return;corporate growth has an impact on the discount rate of return and the yield of lock-in period in the opposite direction,respectively,but does not significantly affect the return on investment as a whole;(4)The proceeds is negatively correlated with the yield of lock-in period;issuance ratio is positively correlated with the four returns;excess return of capital operation projects is higher than that of matching financing and replenishment projects;(5)the P/B ratio has little effect on the rate of return;the better the stock’s liquidity,the lower the yield of lock-in period and the lower the comprehensive rate of return as well as the excess return;(6)the bull or bear market will affect the psychological expectations of institutional investors,thus affecting the discount magnitude;in bull and bear markets,private placement stocks will probably follow the rise or fall,but in bear market,due to the boost of private placement,stock prices will fall much less than the market index,resulting in higher excess returns than in other market conditions.Finally,according to the conclusions of this paper,the author puts forward strategic suggestions for institutional investors and individual investors respectively.The difference is that institutions can participate in the subscription of directional additional shares at the issuance stage to enjoy discount,while retail investors can only decide whether to buy,sell or continue to hold a certain stock after the announcement of private placements.