Study On The Private Placement Of SQ

When a company needs financing,going public is a very good choice.After a company successfully goes public,there are many ways of financing,including rights offering,additional issuance and issuing convertible bonds.Since 2006,as soon as the private placement appeared,it has been favored by enterprises by virtue of its advantages such as low financing cost,short time cost and fewer restrictions.In just a few years,its financing scale far exceeds other models..Taking SQ as an example,this paper analyzes the reasons for the premium private placement and verifies the rationality of the premium private placement.By analyzing the situation of each stage of private placement and observing the announcement reaction of each stage,it is found that private placement brings positive announcement effect in short order.,long-term effect is not significant.Abundant capital makes the company’s stock price and financial index become more smooth and share price movements more steady growth,investors risk is reducted;Through the financial data of SQ group before and after the private placement,we studied the changes of these data before and after the private placement of SQ group from the perspectives of operating ability,profitability,debt paying ability and growth ability,and found that only the company’s financial value increased significantly in that year of private placement,after that year,the financial data did not change significantly.Through the above analysis,it is found that the abundant capital flow of SQ group’s private placement can make the company’s stock price and financial index more stable,and this private placement is good to the stable development of the company in the future.