Research on Fund Management of Diversified Tobacco Enterprises

Abstract

Although the diversified operation of tobacco enterprises can tap the potential of stock resources, obtain the advantages of scale economy and scope economy, and expand brand influence in breadth and width, on the other hand, a diversified investment may also bring huge risks to tobacco enterprises. This paper studies the non-linear 'U' shaped evolution relationship of tobacco enterprise capital management and comprehensively studies the influence of different property rights, agency costs, financing constraints and other common influencing factors on tobacco enterprise capital management. Moreover, the paper establishes a comprehensive analysis model to test how enterprises effectively use the 'U' shaped evolution relationship with empirical evidence to find the Pareto optimal state among financing constraints, financial flexibility, agency costs and cash holdings.