Research On The Impact Of Equity Pledge Of Major Shareholders On The Investment Behavior Of Lianjian Optoelectronics

In recent years,with the reduction of restrictions imposed by the regulatory authorities on equity pledge,in the face of severe financing constraints,equity pledge has won the favor of major shareholders of listed companies with its unique advantages of fast approval,short cycle,low financing cost,and small constraints.Therefore,the phenomenon of large shareholders using equity pledge to raise funds is increasingly widespread.However,with the continuous expansion of the scale of equity pledge,its risks are also increasingly prominent.Because China’s supervision of equity pledge is not strict enough,and the governance mechanism of most companies is not perfect,the high proportion of equity pledge will lead to the aggravation of the agency problem and exacerbate the separation of the two rights.Therefore,in order to avoid the loss of their own control,major shareholders often influence the company’s investment behavior after equity pledge,Such as changing the investment direction of the company or expanding the investment scale,to cater to the investors’ investment sentiment,transmit favorable information to the market,improve investors’ investment confidence,and achieve the purpose of stabilizing the stock price,so as to continue to grab private interests.However,whether to change the investment direction to cater to investors’ sentiment or blindly expand the investment scale,it will reduce the company’s investment efficiency,increase the company’s operational and financial risks,and reduce the company’s long-term value.Therefore,this paper takes Lianjian Optoelectronics Co,Ltd.as a case enterprise,combining the specific investment and operation conditions of the company and the pledge of major shareholders’ equity,analyzes the impact path of the pledge of major shareholders’ equity on the enterprise’s investment behavior,and the specific impact is shown in three aspects: changing the investment direction,expanding the investment scale,reducing the investment efficiency,and using Richardson model to verify the investment efficiency,Finally,the following conclusions are drawn: when the proportion of equity pledge of major shareholders is small and moderate,the degree of separation between the two rights is light,and the major shareholders have no tunneling motivation,it will have a positive effect on the company’s investment behavior and improve the investment efficiency;However,when the proportion of equity pledge of major shareholders is too high,the company’s equity will be mainly concentrated in the hands of major shareholders,which will aggravate the degree of private interests of major shareholders.At the same time,changes in research and development investment,overdue and continuous circulation pledge of major shareholders will aggravate inefficient investment behavior.In addition,the imperfection of the company’s internal control and governance structure also aggravates the tunneling motivation after the pledge of major shareholders’ equity,further promoting the impact path of the pledge of major shareholders’ equity on the enterprise’s investment behavior.Finally,this paper puts forward constructive suggestions from various aspects,hoping to help standardize the equity pledge behavior of major shareholders and improve the investment behavior of enterprises,improve the investment efficiency,and realize the benign and sustainable development of enterprises.