Study On The Risk Control And Performance Of Huaqiang Fangte's Private Placement

SMEs have become a part and parcel of domestic economic development process already,playing an important role in technological innovation and increasing employment rates,but many of them are meeting with financial difficulties.The NEEQ market mainly serves SMEs,providing them with more convenient financing channels and multiple financing methods.Among them,the private placement is favored by listed companies because of its flexible system and low threshold.As the NEEQ market continues to mature,the advantages of private placements continue to emerge,but so far less than one-third of the listed companies in the market have implemented private placements,many of which have failed.Huaqiang Fangte belongs to the cultural and entertainment industry,successfully implemented two private placements,raised 2.6 billion of funds,and listed the market-making system and stratified management in the NEEQ market,avoiding the risk of market instability,so case has a certain representativeness.The paper focuses on the motivation and implementation process of the company's private placement,the risk control in the process of private placement and the effect of private placement,in order to provide reference for other enterprises to implement private placement.The paper firstly analyzes the financing background of Huaqiang fangte's private placement,and sorts out the relevant literature and core theory of private placement at home and abroad;analyzes the main business and business model of Huaqiang Fanta,the financing needs,the motivation for selecting the private placement financing method and the two orientations.The issuance scale of the additional issuance and the use of raised funds;then the risk control in the process of private placement is analyzed based on the three perspectives of enterprises,shareholders and investors;then the event research method is used to analyze Huaqiang Fangte on the 15 th day before and after the announcement date of the plan.The announcement effect of the company's specific issuance,from the company's 2014-2018 September financial indicators,value indicators and non-financial indicators to analyze the impact of its private placement on business performance.Finally,the conclusions andrevelations drawn from the case.Through the research,the paper finds that Huaqiang Fangte has accurately selected the time and reasonable pricing in the process of additional issuance,consolidated the control rights of the controlling shareholder,avoided the risk of interest transfer,rationally used the raised funds,effectively controlled the risks in the private placement process,and ensured the implementation of private placement plan.Huaqiang Fangte's stock price has shown an upward trend after private placement,and investors are more optimistic about the company's private placement,so it has a positive announcement effect in the market.From the perspective of business performance,the private placement increased the company's profitability and solvency,optimized the capital structure,improved the cash flow,improved the company's internal governance structure,improved the R&D level,and strengthened the industrial layout and brand promotion,helping the development of the company.From the perspective of enterprise value,private placement has greatly increased the net assets of enterprises,and it takes a certain period of time to generate returns on investment projects.Therefore,the impact on corporate value is not obvious in the short term.Based on this,the paper concludes with reasonable suggestions for listed companies and small and medium-sized investors in the NEEQ market to improve the operating status of listed companies,protect the interests of investors,and enable the healthy development of the NEEQ market.