Research On The Motivation And Performance Of Vocational Education Enterprises’ Backdoor Listing

In the Chinese capital market,companies with the intention to go public mainly rely on IPOs and backdoor listings.In the securities issuance and listing system,the approval system imposes strict review requirements on companies to be listed,which requires a long waiting period and heavy capital and time costs.The registration system is still in the pilot reform stage.Compared with IPOs,backdoor listings have low entry barriers,low issuance costs,and shorter approval procedures.Therefore,many companies that urgently need to obtain funds from the capital market take it as a priority.In recent years,in order to meet the needs of students for research,advancement and employment,the vocational education and training market has been prosperous and large in scale,and the domestic vocational training market has grown steadily.In the process of enterprise development and expansion,they are faced with funding needs such as difficulty in loans and financing.Therefore,vocational education enterprises need to obtain support from the capital market as soon as possible.Backdoor listing is a shortcut for vocational education companies to obtain listed company qualifications and broaden corporate financing channels,which can optimize and allocate social resources and create more benefits.In 2018,Zhonggong Education entered my country’s capital market through backdoor Yaxia Automobile,but its competitor,Huatu Education,failed to backdoor twice.Whether vocational education companies’ backdoor listings based on different motivations produce positive performance and help their development is related to the success or failure of backdoor listing,therefore,the research on the motivation and performance of backdoor listing is becoming more and more important.Starting from the development of the vocational education industry and the company’s backdoor listing behavior,this paper selects the case of Zhonggong Education’s backdoor listing of Yaxia Motors,and analyzes the motivations of Zhonggong Education’s backdoor listing from both macro and micro aspects combined with the internal and external environment of the company,and finally analyzes the backdoor listing from multiple angles.The performance changes after listing,draw relevant conclusions and enlightenment.Through an in-depth analysis of the case of Zhonggong Education’s backdoor Yaxia Auto’s listing,this article draws the following conclusions: Zhonggong Education chose to go backdoor listing because it is an excellent way for vocational education companies to enter our country’s capital market under the external environment because of few procedures,low difficulty and high valuation.From the micro-environment,Zhong Gong Education adopts the SO strategy of simultaneous expansion of R&D,business,market,and channels.Under the strategic direction,Zhong Gong Education needs to absorb funds to expand the scale and quickly go public in order to gain an advantageous position in the industry competition.There are motivations such as backdoor seizing opportunities and lower costs.When studying the impact of the backdoor listing event on the performance of Zhonggong Education,we analyzed the market response,non-financial performance and financial performance,and concluded that the backdoor listing has brought positive reactions in the short and long term.Affected corporate fundraising,operation,branding,etc.,the backdoor listing ultimately produced positive performance on the profitability and development ability of the company’s financial performance.In this case,the debt solvency and total asset turnover rate both had a different degree of decline.It is necessary to combine the specific analysis of the industry and corporate behavior.Based on the analysis of this case,the author has the following suggestions for other backdoor companies: similar vocational education companies and private education institutions should make relevant preparations before backdoor listing,including carefully selecting shell resources,choosing appropriate backdoors,adopting appropriate asset evaluation methods and paying attention to relevant government policies and other measures.At the same time,we must continue to pay attention to the long-term financial situation,be alert to potential risks,and take preventive and response measures to achieve the sustainable development of the company.