Research On Financial Leverage Effect Of Greenfield Holding

In recent years,the development of real estate industry,an important part of our national economy,seems to slow down.As the real estate industry has the characteristics of capital intensive and high asset liability ratio,the investment and development of the real estate industry needs strong capital support,so the financial leverage has been favored by most real estate enterprises.In such a market environment,high financial leverage has become a hot issue with research value,and even will affect the sustainable development of real estate enterprises.Because high leverage will produce negative effect of financial leverage,which will cause some adverse effects on enterprises.Therefore,an important strategic goal of the future development of China's real estate enterprises is to deleverage and reduce the negative effect of financial leverage.How to reduce the financial leverage of real estate enterprises and reduce the negative effect of financial leverage is a very worthy of study.Based on the theory of financial leverage,capital structure and risk management,this paper analyzes the negative effects of financial leverage and the causes of the negative effects by literature induction,quantitative and qualitative analysis and case analysis.Finally,it gives the appropriate countermeasures and suggestions Through the research of this paper,we hope that we can understand the importance of real estate enterprises' deleveraging,and have certain guiding significance and reference value for Greenland holdings in the future.First of all,this paper introduces the background,significance,methods and contents of the research,literature review.Secondly,it discusses the related theories,including financial leverage theory,capital structure theory and risk management theory.The third part is the analysis of the current situation of the financial leverage effect of Greenland holdings,including the introduction of Greenland holdings and the performance of the negative effect of financial leverage.The introduction mainly includes the background and the financial situation.The negative effect mainly includes the increase of debt scale year by year,the greater debt maturity and repayment pressure,the decline of refinancing ability,the increase of agency cost and the low profitability of assets.The fourth part is from the capital structure,enterprise risk awareness,cash flow and capital utilization to analyze the causes of negative effects.The fifth part is to summarize the above problems and the causes of the problems,and give the countermeasures and suggestions on how to reduce the negative effect of financial leverage of Greenland holdings,so as to provide reference for the real estate industry to use the financial leverage reasonably and reduce the negative effect of leverage.The last part is the conclusion of this paper.