Research On The Using Effect Of Over-Raised Funds On GEM

On October 30,2009,the "Growth Enterprises Market(GEM)" which is called NASDAQ(National Association of Securities Dealers Automated Quotations)in China was formally listed after ten-years planning,preparation,and negotiation.The establishment of the GEM has provided good prospects for the development of high-tech enterprises.In particular,the high-quality platform it offered has greatly promoted the development of SMEs.However,at the same time,many problems are also increasingly exposed,especially the phenomenon of super-raised funds of the GEM.Facing of a huge amount of super-raised funds,how to use them efficiently and reasonably became a hot topic for the GEM market.Listed companies of GEM can raise a large amount of funds through the IPO,which solves the problem of financing difficulties for many SMEs.But drawbacks also appear.Over-financing caused super-raised funds of listed companies.Although the Shenzhen Stock Exchange specifically regulate the use of super-raised funds of listed companies on GEM,it still has strong flexibility.The phenomenon of wasteful,inefficient use or even misappropriation of super-raised funds are still common.Problems caused by accumulating directly of super-raised funds in banks for interest,asset replacement,over-investment,or even buying houses and cars are not consistent with the optimizing resource allocation of the capital market.The fact that the use of the super-raised funds inefficiently and unreasonably violates the investor's initial intentions,which not only damages rights and interests of shareholders,but also affects company's own market value and even has side effects for the stable development of the securities market.There are many reasons for the inefficient use of super-raised funds by GEM listed companies.For example,major shareholders have purposes to realize their private interests and intermediary has not played their regulatory role.Therefore,it is necessary to analyze the causes,directions,and effects of super-raised funds in China's GEM listed companies.Seeking methods to deal with such irrational investment behavior is a must of China's capital market.These studies have enabled more reasonable use of the super-raised funds of listed companies.At the same time,investors will also increase attention to the management and use of super-raised funds.It has played an important role in improving the disposition of social resources.This paper analyzes and summarizes the related documentations and combines current research findings with the current legal system of the domestic GEM market on super-raised funds,taking Hiconics New Energy Technology Co.,Ltd.as the research object.The method adopted in this paper is a combination of theoretical analysis and case study.It analyzes the reasons for the super-raised funds of listed companies on the GEM and the effect of the use of super-raised funds.On the one hand,the author sorts out related data and analyzes the status quo of super-raised funds of listed companies on China's GEM.On the other hand,known the use of super-raised funds of companies in the case and comparison of relevant data to study the result of use of super-raised funds,and to analyze the impact of huge super-raised funds on the company.With the long-term development of the enterprise,if it is impossible to use super-raised funds reasonably and efficiently,making it play a positive role,it will not be able to promote the development of the enterprise itself or even become a burden or posing some obstacles to its development,though the IPO gains a high amount of supper-raised funds.Therefore,this article proposes relevant policy recommendations on how to improve the use of super-raised funds,in order to help make super-raised funds use reasonably and ensure stable and standardized operations and development of the market.