Empirical analysis on the relation between capital structure and corporate performance of listed companies in SME boards in china

Abstract

Small and medium-sized board market in China was established in 2004 and developing very fast. By the end of 2011, there are 648 listed SMEs in China. Small and medium-sized listed enterprises (SMEs) play an important role in economic development, but financing problems and lack of capital structure flexibility are also difficult issues they need to deal with. This article makes regression analysis on the data of small and medium-sized listed enterprises from 2009 to 2011 to study the relationship between capital structure and corporate performance. It is concluded that different performance indicators lead to different relationships. There was a significantly negative correlation between the Tobin Q and capital debt ratio, while comprehensive accounting indicator and capital debt ratio are significantly positive correlation. The relation between short-term debt ratio and performance is significantly mutual negative correlation, no matter what indicators are used. Long-term debt ratio does not present a significantly positive impact on Tobin Q. According to empirical conclusions, it is suggested to help improve the capital structure and corporate performance of the SMEs.