Based on the theory of equity market timing combined with the refinance policy in Chinese stock market, the effect of refinancing condition in Chinese stock market on the capital structure is investigated elaborately. It is found that the constraint of refinancing policy results in the difference of issuing time among the listed companies under the overvaluation condition of circulating stock. Moreover, the difference of finance frequency causes the difference of utilizing the refinancing condition in listed companies. For the firms with more refinancing, three main conclusions can be drawn: 1. The overpricing of stock decreases the firm leverage in most years. 2. The historical stock valuation in the year of finance has a significant negative impact on the present capital structure. 3. The current market valuation of stock affects the accumulation change of capital structure since IPO notably. For the sample firms as a whole, three opposite conclusions can be obtained: 1. The present and historical market overvaluation of stock does not affect capital structure of the firm coustantly. 2. The preference of issuing equity does not turn into the actual outcome due to the constraint of refinancing policy. 3. The total average firm leverage decreases. To large extension, it is the outcome of that of the partial firms refinancing several times absorb much more finance capital and average them.