The Analysis Of Shenke Ltd.’s IPO Effect

IPO initial public offering of stocks, whether a company can be listed successfully is of significant importance for its investment and financing in the capital markets. The company can obtain large amounts of equity capital and expand the scale of the company through to be listed.Meanwhile, the company also can improve the present situation of insufficient funds and enhance the ability to resist risk. But we can find companies around the world all have the “IPO effect” through the study of scholars both at home and abroad. “IPO effect” means that the company can be listed successfully has a poor company’s performance indicators after to be listed.The company should enhance the risk resistance ability of the enterprise and expand the scale of production after to be listed. Why the company can be in the opposite situation?Through the analysis of scholars both at home and abroad in the “IPO effect”, we can find the main reason about “IPO effect” is that the company takes advantage of earnings management to increase profits before to be listed. The company can change the profits through changing the accounting policy. It can cut the price temporary and ease credit conditions to stimulate the sales revenue growth. But these ways are abnormal promotion methods. It also can change the non-recurring profit and loss of company to change profits. But these ways can’t be continued, so the growth of profits can be effected. The profits compared with before of company will fall.The Shenke Ltd is a company focusing on the bearing manufacturing. The company has a good operating performance before listing. The company was successfully listed in 2011.The company has the serious “IPO effect” after listing. It was ST in two years after listing. The rights and interests of shareholders and investors was damaged in different degrees. We can use the financial indicators data in five years around listing in the passage. We can analysis the operating ability、debt paying ability、profitability and the growth ability of the company and know the severity of the “IPO effect” about the company. We can find several problems of the company through the analysis of the “IPO effect” about the company. First, the company adjust the balance of non-recurring profit and loss to improve the profits of the company. Then the profit was influenced while the reduce of the non-recurring profit and loss. Second, the company cut the price temporary and ease credit conditions to stimulate the sales revenue growth. But the profit and cash flow was influenced while the increase of the accounts receivable. Third, the company don’t use the money got through the listing effectively. The company change the way of fund-raising and waste fund-raising seriously, so the profits of the company was influenced.Through the analysis of the Shenke company, the passage can provide some advices about invest and examine to the investors and regulators. And the combination of the “IPO effect” and company is also the innovation of the passage.