Study on Debt Financing Effect of Listed Companies in Our Country

In order to study the effect of debt financing on companies' performance,a forecast model of principal component of the debt financing effect was proposed via principal component analysis.Taking the financial data of 824 listed companies in manufacturing industry during 2003-2004 as samples;the debt financing effect of the listed companies was analyzed synthetically by means of the proposed forecast model.The analyses show that the comprehensive scores of debt financing effect F goes in the same direction as debt stock and debt increment does in certain scope,and show that a listed company may improve it's performance through debt financing.