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The Long-term and Short-term Effects of Equity Pledge on Corporate Value of SMES-Based on the Research of Company A

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DOI: 10.25236/icmeem.2019.033


Songqin Ye, Wei Zhang

Corresponding Author

Wei Zhang


Equity pledge financing on the one hand can not dilute equity and does not affect voting rights, voting rights and income rights. Therefore, equity pledge financing has many advantages, but there are also some limitations. Equity pledge may have a certain impact on the corporate value of small and medium-sized enterprises. This paper discusses the short and long-term effects of equity pledge on smes. The findings are as follows: first, investors have a negative attitude towards equity pledge. Secondly, the frequent equity pledge financing of company A is not conducive to the development of the company's business performance, causing negative impact on the company and damaging the company's value.


Pledge of equity; The value of the company; Market effect; Financing