Research On The Financial Effect Of Private Placement Of LONGi Shares

Private placement refers to non-public offering,also known as "targeted fundraising" and "private placement",which is mainly a way of issuing stocks for individual investors or institutions.Private placement has become an effective financing method for equity refinancing because of its relatively simple issuance procedures,low financial requirements,and high efficiency.LONGi is a leading enterprise in my country’s photovoltaic equipment manufacturing industry and the world’s largest producer of monocrystalline silicon wafers.It has good development capabilities.By studying the financial effects of LONGi’s private placement,it is worth learning from.place,prompting enterprises to learn from each other and maintain a good development in the fierce competition environment.This article takes the case of private placement of LONGi shares as the research object,and summarizes the contents of domestic and foreign related research literature on private placement and financial effects.Research on the additional issuance plan of LONGi shares,explain the process and motivation of the additional issuance,and analyze the market reaction and financial performance of LONGi shares before and after the private placement.First,the excess rate of return and cumulative excess rate of return within 21 days before and after the private placement of LONGi shares were calculated by the event study method,and the market reaction of the private placement was reflected by the market fluctuations.The reaction had a favorable i mpact and had a positive wealth effect;in terms of financial performance,based on the financial data of LONGi,the company’s financial performance was studied using the comparative analysis method and factor analysis method,and the financial performance of LONGi was compared.The financial indicators are compared with the average value of the photovoltaic equipment industry,and the comprehensive performance of LONGi shares is evaluated by factor analysis.The analysis results show that the private place ment of LONGi shares this time has a positive impact on the company’s financial performance.Through in-depth analysis of the results of the financial effect analysis of the private placement of LONGi shares,this paper summarizes the factors that may affe ct the financial effect of the private placement of LONGi shares.The study found that the development of macroeconomics and industries,information disclosure,development prospects of projects,the number of additional issuances and the shareholding rati o of investors,the target of issuance,the preliminary preparations before the private placement,and the efficiency of capital use may all have the potential to affect the private placement of companies.financial effects.Therefore,enterprises should c hoose the right time to conduct private placement before implementing private placement,so as to make the company develop well.Support the targeted additional issuance to institutional investors on the target of issuance.The raised funds should be inves ted in projects suitable for the enterprise,and do not invest blindly in order to improve the business,ensure technological leadership,and promote the implementation of targeted additional issuance to a certain extent,enterprises should focus on the changes in the long-term financial effects after the private placement,manage and supervise the investment in the raised funds,so as to optimize the market financing environment,and allow the private placement to bring better value creation to the enter prise.