Study On The Motivation And Economic Consequences Of Continuous Reduction Of Wuxi Apptec

After the equity reform,equity ownership fell sharply,as did many market investors.China’s Securities and Exchange Commission set the rules to regulate write-offs by major shareholders.Three rules of reduction in three years from 2015 to2017,but in 2018,the trend of reduction arose again and became increasingly severe.Therefore,it is of great significance to study the new type of major shareholders’ reduction.Pharmaceutical outsourcing industry as one of the seven emerging industries,also involved in the wave of reduction.Faced with the outbreak of the global epidemic,the pharmaceutical sector is improving,and the focus The transformation activity in pharmaceutical industry has shifted away from Europe and the United States to China.The market value of Chinese pharmaceutical outsourcing enterprises is mostly at a high level,and many domestic enterprises began to continue to reduce their holdings.Among them,Wuxi Apptec is one of the most representative enterprises.Wuxi App Tec has always maintained the first place in the domestic market share and its performance is constantly rising.However,since the expiration of the lifting of the ban in 2019,Wuxi Apptec has continued to reduce its holdings.In the following month of May 2021,Shanghai Yingyi,the concerted action of its major shareholders,violated the information disclosure principle and illegally reduced the holdings of 2.9 billion yuan and was fined 200 million yuan by the CSRC.This reduction behavior,which is inconsistent with its growth performance,has repeatedly hit the market of minority shareholders and caused the market to question.Therefore,this paper believes that it is representative to choose Wuxi App Tec as the research object,explore the motivation and economic consequences behind its continuous reduction through case analysis,and put forward solutions and relevant suggestions to regulate its behavior.This article mainly uses the case study method and the event study method,after examining and summarizing the research results of previous researchers on the behavior of the reduction of major shareholders,takes the theory of information asymmetry,the theory of signal transmission and the theory of return on control rights as the theoretical basis of the research,Analyzes the context of the industry and its own characteristics of Wuxi Kant,and summarizes the motivation for its continuous reduction.Second,the investment effect of firms before and after the reduction is analysed by the investment capital stock index.Secondly,the financial performance of firms is analysed by the four capacity indices.Finally,the negative market reaction caused by the reduction behavior is analyzed by the method of event study and stock price change.Through the research,it is clear that the reason why large shareholders declining their holdings because of the overvaluation of the company and the demand of self profit.The manipulation of reducing holdings mainly involves releasing positive information and illegal reducing holdings to ensure the smooth implementation of reducing holdings.The continuous reduction of shareholders’ holdings will reduce the company’s financing ability and investment efficiency,affecting the operation and development of the company,causing a continuous decline in the stock price and harming the rights and interests of small and medium-sized investors.solutions are proposed for Wuxi App Tec from the perspective of enhancing competitiveness and improving.Aiming at Wuxi Apptec,this paper puts forward countermeasures from the perspective of enhancing competitiveness and improving the director system,and finally puts forward relevant suggestions from the level of listed companies,market supervision and minority shareholders.