Research on the Impact of Debt Financing Structure Upon Corporate Performance on Listed Pharmaceutical Company
|Keywords||listed pharmaceutical company debt financing structure debt overall debt maturity debt category corporate performance|
Since the inception of MM theory, the relationship between capital structure and corporate value become the focus of academic attention. Domestic research mainly focused on the configuration of equity financing and debt financing, in order to achieve the minimum of capital cost and the maximization of corporate value, rarely involved in the relationship of the debt financing structure and corporate performance. According to reflecting corporate debt capital internal proportion, Debt financing structure has an important management function, and ultimately influences corporate performance. Therefore, how the debt financing structure impact on the corporate performance, and how to optimize the debt financing structure of listed companies become an important issue of concern. As a means of multi-disciplinary high degree of integrate advanced technology and high-tech industrial groups, pharmaceutical industry is an important component in our national economy, plays an important role in the capital market. Compared with other industries, the feature of the pharmaceutical industry is high-risk, high investment and long-period, the main part of pharmaceutical industry funding source is its own funds and bank credit, its own funds cannot meet the needs of its own development, still largely depends on debt financing especially bank credit funds, therefore, this paper on the pharmaceutical industry has strong pertinence and application value.In this paper, we select the 77 pharmaceutical companies listed in Shanghai and Shenzhen before December 31th,2005 from 2006 to 2010 five years as the data sample. it is not difficult to find that the irrational pharmaceutical debt financing structure is characterized by low overall level of debt and has a tendency to short-term debt financing, while the bank loans and commercial credit debt is the major component of financing source, less company choose the enterprise bonds financing. Then, According to using factor analysis and multiple linear regression method, this paper will research on how the different debt overall structure, debt maturity structure, debt category structure influencing on the corporate performance. through the empirical analysis, we find that debt overall structure is negatively correlated with corporate performance, debt financing governance function has not been fully exploited. In the debt maturity structure the short-term debt ratio is not significantly correlate with corporate performance and the long-term debt ratio is in significantly negative correlation, because short-term debt does not have significant effect on corporate performance, the low proportion of long-term debt do not fully play its corporate governance effect. In the debt category structure, the bank credit rate is significantly negative correlated with corporate performance, but commercial credit ratio is in significantly positive correlation, as a business major creditors, the bank plays an reverse role in corporate performance, as a business process in natural financing for corporate performance, the commercial credit has an simulative effect. According to the empirical results, debt financing structure does not produce the critical role to the corporate performance. Finally, this paper put forward a series of suggestions to optimize the debt financing structure in bankruptcy mechanism, the relationship between banks and enterprises, the bond market, information disclosure and so on.