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Hi, I need help with essay on Impact of Capital Structure on Financial Performance of Real Estate Firms Listed In Chinese Stock Exchange. Paper must be at least 500 words. Please, no plagiarized work!
Hi, I need help with essay on Impact of Capital Structure on Financial Performance of Real Estate Firms Listed In Chinese Stock Exchange. Paper must be at least 500 words. Please, no plagiarized work!
The study analyses the listed firms based on the following objectives
The study is a descriptive research design that explores the capital structure of companies listed in the Chinese stock exchange in seeking to describe their impact on the financial performance of the same companies. Information about 20 companies was collected from the official website of the Shanghai Stock Exchange (SSE). The companies were selected in accordance to the composite index of the SSE, to ensure the findings can be generalised to other firms. Quantitative data analysis methods have been utilised in analysing the data gathered form the research with regression analysis being utilised to enhance the quality of the research findings. .
Different financial ratios of companies have been calculated and an industry average determined. The ownership of the listed firms is mainly by the government and legal institutions who own 28% and 24% respectively. The total debt and long term debt of the listed companies is 50.49% and 10.15% respectively. The equity over fixed asset ratio for the companies is at 92.77%. There has been a significant drop in the return on assets value which is currently at 9.74%. Chinese firms have an average liability of about 45% while the average liability of the G-7 countries in 54%.
Most of the Chinese companies listed on the SSE utilise a short term financing options and this has been the man characteristic of their capital structure. The capital structure adopted by these firms has the greatest impact on their performance. The companies listed in the SSE have been posting high profits and have financial debts which are lower than the average industry level. These firms are mainly financed through equity capital which is not a debt. Low debts have had a significant effect in resulting to the high profits since there is a reduced level of interests paid, ensuring the