CAO Gold, it is interesting to look at the article published by Zhongzheng Wang on December 12, 2011. The financing of A-shares over a decade has seen a shift from "zero" growth to "misappropriation," which is indeed a curse. The article states that in the 1990s, during the reform and opening up period, to solve capital problems, reduce the state's financial burden, and help businesses meet their immediate needs, the stock market was born. This became an important means for companies to raise funds from the public and supplement credit. Some companies used equity financing to grow rapidly and become industry leaders. However, with time, financing gradually turned into something else. In recent years, the market has repeatedly witnessed bizarre phenomena where listed companies, regardless of whether they lack money or not, have collectively deviated from the original purpose of stock market financing, turning it into a means not for development but for squeezing shareholders' funds. Indeed, this misuse of financing is not sad! Would frequent stock financing behavior not tarnish the stock financing platform? After more than 20 years, the stock market has become not only a place for rapid enterprise development but also a stage where some succeed while others fail, some continue to grow while others degenerate.
As the saying goes, the size of one's heart determines the size of the stage and its interpretation. Different people will interpret it differently. If you are given a sum of money, you can either work hard to create paradise on earth or squander it in the blink of an eye, leading to a mediocre life.
In the past three years, with the restart of IPOs, a wave of A-share financing has broken out, with hundreds of companies rushing to list. There are no shortage of ambitious companies, but there are also many mediocre ones. Frequent financing: the direct purpose of financing is to allocate resources for enterprises' production and management, with the ultimate goal of generating more income to expand reproduction and make money with money. Any business must rely on its own efforts and capital to continuously develop and gradually become the protagonist in its industry.
During the reform and opening up period, due to the lack of financing channels, many companies relied on bank loans, bearing heavy interest burdens. The stock market opened, providing public financing to solve the urgent survival needs of many enterprises on the brink of death. The establishment of the stock market mobilized, accumulated, and concentrated idle social funds, playing a role in fully utilizing market mechanisms, breaking down compartmentalization and regional blockades, promoting horizontal fund intermediation and economic horizontal linkages, and improving overall resource allocation efficiency.
Equity financing is certainly good, but the motives behind it are hidden. After all, the stock market saves enterprises and reduces banks' risks, transferring them to the stock market. With mainly focusing on financing, listed companies inevitably pay insufficient attention to shareholders' interests and damage shareholders' rights. Therefore, this is a good science of finance boosting enterprise growth. Enterprises that use financing well can remain strong and become stronger in the market. The most successful example is Suning Appliance (002024). Its achievements are closely linked to the rational use of financing for continuous expansion.
When Suning listed, domestic appliance retail entered the era of chain operation, led by Suning and Gome, entering major cities, Yongle, Dazhong, Wuxing, and other enterprises started their chain pace in regional markets. Data shows that from 2001 to 2004, the number of Suning Appliance stores increased from 25 to 84, adding 46 stores alone in 2004. This funding gap reached 1.617 billion yuan in 2004 and became even larger in 2005, requiring financing. From 2003 to 2005, changes in Suning’s sales revenue growth and return on net assets showed that Suning's revenue growth was higher than the previous year's return on net assets, with its net profit insufficient to support the demand for funds required by sales revenue growth, thus forming a dependence on external financing.
Suning's first IPO financing in 2004 resolved its refinancing troubles until May 8, 2006, when the SFC approved Suning Appliance's refinancing motion, obtaining 800 million yuan in financing. Most of this money would be used for investment in 100 chain development projects. In 2007, Suning raised about $2.4 billion to create 250 chains, through this cyclical development mode, Suning became the absolute giant in the home appliance chain during its rapid growth period, bringing huge returns to shareholders. By December 9, 2011, the closing price of Suning's complex rights reached 676.72 yuan.
Similarly, Ma Yun of Alibaba developed his company through continuous financing via three rounds, founding Taobao, Alipay, acquiring Yahoo China, founding Ali software, and becoming the largest Internet company in China by market capitalization.
Bad financing gives birth to two different outcomes: wealth creation through listing, enterprise prosperity versus losing the power to struggle. Statistics show that since the IPO restart as of December 8, 2011, the A-share market raised a total of 935.439 billion yuan through IPOs, ranking first globally in stock markets. In 2009, 129 IPOs were completed raising 218.9 billion yuan; in 2010, 338 IPOs raised 483 billion yuan; this year, 247 IPOs have been completed raising 233.5 billion yuan.
According to data from RenaissanceCapital, a U.S. professional IPO statistics supplier, as of December 8, the U.S. IPO market raised a total of $32.8 billion this year, equivalent to 208.7 billion yuan, falling 10.8% compared to last year. Besides the A-share market, financing rates in the United States, Britain, Singapore, and Spain exceeded five billion yuan, while Hong Kong's financing amount exceeded 28 billion yuan.
It is not difficult to see that this year, the A-share market's IPO financing amount is much greater than the total financing of five stock markets. Additionally, additional financing methods are also used by listed companies to raise funds. According to Genius statistics, since January 4, 2009, A-shares have raised 564.253 billion yuan through issuance, among which Shanghai Pudong Development Bank (600000) and Huaxia Bank (600015) raised over 20 billion yuan, 39.2 billion yuan and 20.1 billion yuan respectively.
Without mentioning finance, listed companies achieve self-growth through rational use of funds to repay shareholders alone based on annual dividend capacity. They have shareholders behind them. Data shows that after the IPO resumption in the past three years, listed companies cumulatively distributed dividends totaling only 64.7 billion yuan, accounting for only 7% of the financing amount, completely disregarding shareholders' interests.
For example, Tibetan Medicine (002287) is not short of money, with its main business being a cash cow, sufficient future market capacity growth, and the ability to complete expansion using its own funds, yet it still went public through an IPO. Another example is Weika Wei, whose debt ratio is lower than peers and has high liquidity, gross profit margin far exceeding peer competitors, strong profitability, ample cash flow, and four consecutive years of high dividends. Perhaps just for property securitization and personal wealth accumulation.
For listed companies lacking money seeking development, due to high fundraising costs, they lose sustained growth momentum, the most obvious being GEM companies. In the start-up stage needing money for development, they take the money officer, going so far as performance face-changing scandals. In the third quarter alone, 78 GEM stocks saw year-on-year declines in net profit, with Science and Technology (300073) and Hong Chi Pharmaceutical (300086) seeing net profits fall by more than 80%, shameful!
Financing souring injures investors who cannot afford it. If financing loses its meaning and does not achieve the intended role, then is there reason for its existence? His presence will only allow investors to shout in despair. Analytics show that equity financing does not achieve the purpose of optimizing resource allocation, some listed companies usually do not possess high-quality assets. The most obvious is that since last year and a half, small plates and large-scale GEM financing have occurred, but the quality of listed companies lacks assurance. Like Fuling mustard (002507), Jiayu shares (300117), these lack growth companies, like Prudential shares (300023), Power (300068), these performance-changing companies mingle in the stock market, representing enormous waste of resources in the stock market.
At the same time, the emergence of a large number of super funds raised represents the biggest waste of stock resources. Many new shares raise funds exceeding planned usage, now GEM companies raise funds more than twice their planned fundraising. This part of the large amount of capital becomes idle and is even used to buy property or cars, representing the biggest waste of resources on the stock market.
Perhaps because of this, a few days ago, the Commission intends to launch a mandatory bonus system, such as requiring listed companies to improve dividend policy and decision-making mechanisms, strengthening supervision over listed companies' profit distribution decision-making process and implementation. Refining return planning requirements in the prospectus, dividend policy, and dividend plans, making prompt and significant matters transparent, enhancing transparency initiatives regarding dividend matters, especially those concerning investors.
However, a Beijing investment bank brokerage said the bonus plan relates to the company's future capital structure and financing arrangements, similar to the raise in the IPO process, investment, and project planning, requiring rigorous argumentation, hasty decisions should be avoided.
Not excluding that some companies may not achieve their proposed bonus plan strength, merely paying lip service, ultimately failing to achieve their dividend commitment, making the commitment meaningless talk.
In fact, regardless of self-development enterprises or a more complete bonus system to protect shareholders' interests, the most fundamental aspect remains market health financing, needing to combine financing with returns from listed companies, truly achieving optimization of resource allocation effects, ending the emergence of super-raised funds causing resource waste, allowing financing to play maximum benefits.
Otherwise, the changed taste of financing will continue to plague the entire stock market, continuing to play the role of pit investors.
Many companies wrestle day and night for their livelihood, but with the restart of IPOs, a wave of financing strikes, many companies forget the trouble of growth, instead thinking about how to spend it, merely eating bank deposit interest, distressing investors' money.
In three years of financing tide, few listed companies have achieved high growth, touching many. With the nature of money, work, and even becoming the largest shareholder, this week, committing a crime: using public money to buy financial products, occasionally buying lottery tickets for recreation, listed companies have money with nowhere to spend, finding ways to spend it, consuming investment products as a great place to go.
According to rough statistics as of June 22 this year, Siu Chi shares (002429) announced that the company intends to use 600 million yuan of its own idle funds to purchase low-risk income-producing financial products, guaranteed floating expected annualized rate of return of 5.7%, financial period ranging from 7 days to one year, according to the availability of funds by the company. Siu Chi shares' funds for purchasing financial products this year have reached 926 million yuan, worth noting that the company listed on the small board on June 10, 2010, raising a total of 1.633 billion yuan, using half of the raised funds for investment products, indicating Siu Chi shares has too much money!
Of course, from an investment perspective, the amount Siu Chi shares spent is not too costly. On May 19 this year, Conch Cement (600585) was approved by the SFC for a public offering of bonds not exceeding 9.5 billion yuan in total size. On June 14, Conch Cement announced 40 million yuan to purchase financial products, bond financing and money to buy financial products, asking Conch Cement, in the end, is it short of money or bad money?
What's more, secretly misappropriating raised funds to buy financial products. On April 19 this year, Shenglai Da (002473) set aside 12 million yuan from the proceeds of the fund account, on April 22 set aside 35.4 million yuan from the raised fund account, accumulating eight times for 21 days of the Bank's launched financial products and 7-day financial products, without fulfilling relevant approval procedures and information disclosure obligations in a timely manner, eventually being punished by the Shenzhen Stock Exchange.
Many market participants appealed to the Commission for the need to strengthen supervision and management of raised funds, otherwise, more raised funds might enter the bank financing market in disguise rather than for the main business, seeking long-term development.
Two crimes: arbitrarily changing the tendered financing, wonderful outline of the raised funds project. The hand of the money freely changes the raised investment projects, will the financing of listed companies turn into castles in the air?
How to paint the cake, how to draw it, how to change the radius tip flat, how to change it?
On August 19, 2011, this year, Stars Technology (300256) listed on the GEM, less than two months later, changed the raised investment project.
On October 17, the company stated that it proposed to implement the production line construction project, among which District No. 8 implementation, the investment amount dropped from 358 million yuan to 348 million yuan.
Only reducing the investment from 358 million yuan to 348 million yuan, sending 10 million yuan, they changed construction to leasing, giving reasons that the raised funds are sufficient, isn't this argument funny?
Raising less than a billion less than planned, in that case, where does the saving of 10 million yuan go, what role can it play?
Additional financing incomprehensible happened. In August 2008, Shanghai Putian (600680) raised nearly $700 million additionally, using 380 million yuan on November 8 this year for an investment project, and the remaining approximately 350 million yuan changed for replenishment of Putian.
Not to mention spending 380 million yuan in three years, a project taking three years to respond slowly? Terminating the original project after three years means the initial investment is wasted, sympathizing with investors participating in the additional issue!
Three crimes: raised funds not yet formally invested, or slow progress, many investors questioned, did not want listed in Sea Technology (002401), recently more of its raised investment project changes before the change, raising investment projects almost at a standstill.
Prospectus, China Shipping intends to invest 31.39 million yuan in intelligent power distribution board projects, but one year later, the project only invested 139.85 million yuan, accounting for 4% of the planned investment.
In fact, this is not an exaggeration, some listed companies more than 1 year also cannot put!
In late November this year, Hui Feng shares (002496) intended to change the raised tender and the original raised investment project of rural marketing network construction for more than a year, not putting a penny.
In its prospectus, Hui Feng shares devoted six preach pesticide grassroots marketing network construction projects, claiming to cultivate.
In fact, one year later, Hui Feng shares even one did not start building, because they have no investment prospectus raised investment project is a wonderful story!
Currently, the two cities still involve more than 400 capital investments exceeding 1,000 investment projects in place, among which half of the companies have less than 50% utilization of funds, like Palm Garden (002431), up to the Chinese intelligence (002512), 16 utilization of funds and even less than 10%.
This year's issuing companies, their use of funds is also not ideal, the first half of this year implementing additional 268 companies, 54 utilization of funds less than 10%, including 25 of Bohai Leasing (000415) project investment even unused.
Four crime: most of the raised funds over the three high release lie bank IPO, suddenly rich overnight listed companies but sometimes happiness is also troubling, because more money, how to use?
The lack of planning for listed companies in the final choice is loan repayment and bank deposit.
If repayment can understand, then exceed raising funds to take the bank deposit people can not figure out.
Since the restart of the IPO, the phenomenon of super-raise is very serious before the company can not think of how to use the raised funds over the behind the companies listed, why that does not consider how to use the super-raised funds, eat simple bank deposit interest?
From this year's use of the listed companies raised funds over the situation, there are more than 70 billion yuan deposited in the bank, accounting for more than 70% of raised funds over the proportion of the terms of the one-year deposit rate of 3.50%.
These new listings raised funds by virtue of ultra-eat interest kept the bank phenomenon is more obvious in the GEM.
According to mid-October, Ping An Securities research report shows that 84.66% of the companies listed on GEM, raised funds over the idle in the bank; the use of published plans to repay bank loans and supplement working capital, the two investment in the proportion of 51.42% of the overall investment.
Similarly, last year, the phenomenon of super funds raised the bank deposit is also very crazy, issued to 148 yuan last year, Hai Purui (002399), ultra raised nearly 5.1 billion yuan, 48 billion when the company is used to deposit banks, which undoubtedly is the great irony of the company's high-priced issue.
It is precisely because of this Guaixiang bank took aim at super-raised funds of listed companies.
Statistics, in the first half of this year, the Bank of China Shenzhen Branch was the IPO of nearly 500 million yuan of funds deposit.
If you can not solve the super-use of funds raised, the future financing will result in a lot of waste of money.
Five crimes: entrusted loan to earn extra money
Besides depositing in banks, fun surplus funds to make money entrusted loans, holding a large number of super funds raised in the small cap shares, many exceed raised funds to use the entrusted loan.
In April 2010 listed Lisheng Pharmaceutical (002393), who in the IPO Excess funds raised 45 million yuan for the solution of a wholly-owned subsidiary of a shortage of liquidity difficulties.
Listed in January of that year, Delisi (002330), the listing did not take long to owned subsidiary of entrusted loan of not more than 40 million yuan, the period of 12 months, the interest of not less than the same period bank loan benchmark interest rate.
Similarly, the company plans to use the private placement of funds entrusted loans.
Such as the hippocampus shares in May 2010 announcement, the board decided that the private placement will not exceed $500 million raised funds through financial institutions, commissioned by the form of loans into the hippocampus Zhengzhou for new product development project, commissioned loan interest rate the central bank over the same period benchmark lending rate stood at 10%.
This year, Central South Media (601098) by Minsheng Banking (600016) Branch of Changsha to Xiangtan Electric Manufacturing Group paid 300 million yuan entrusted loan, the annual yield of not less than 8 percent.
Sunny facilities (600830), Runtu shares (002440), Time Publishing (600551) and year out through the bank entrusted loans.
According to rough statistics of the well-known financial commentator Ye Tan said recently that listed companies entrusted loan prevalence of the more worrying the Chinese financial ecological deterioration, on the one hand is a waste of money to overflow the real economy to reap high profits, on the other hand, numerous real economy Zuokun credit crunch grudge, starving.
The injustice of capital allocation, capital allocation is invalid artificially created capital utilitarian class, Chinese funds vicious arbitrage to the stock market extended to poison the investment environment of the securities market.
(Daily News)
CAO looks around and seems confused, Ah ha ha! Zhendou!!