Study On The Problems In The Use Of Cixing's Share-raising Funds And The Use Effectiveness

On October 30,2009,the GEM market was formally established,which brought good financing opportunities to SMEs and high-tech enterprises,promoted the development of high-tech industries,and enhanced the core competitiveness of Chinese enterprises.As of December 31,2018,739 GEM companies in China have raised 924.08 billion yuan from the market.These funds bring a lot of investment opportunities to GEM companies,to a certain extent,alleviate the pressure of insufficient funds and financing difficulties of GEM companies.However,there are many problems in the use of fund-raising by GEM companies.Among the huge amount of funds raised by GEM companies,a considerable portion of the funds are idle in the bank to generate interest,to purchase real estate and land,and there are phenomena such as random changes in investment projects and project delays,which lead to inefficient use of fund-raising and waste of capital market funds,so how to rationally have them? Effective use of fund-raising has always been a concern of people.Relevant institutions have also promulgated a series of laws and regulations to curb the irregular use of fund-raising,but the problems in the use of fund-raising have not been fundamentally solved.This paper studies the use of fund-raising,probes into the problems existing in the use of fund-raising in enterprises and analyses the causes,then analyses the effect of fund-raising,and puts forward some suggestions for improving the use of fund,which can provide reference for other GEM companies to use fund-raising efficiently and reasonably,and promote the healthy development of GEM enterprises and capital market.Firstly,this paper summarizes and classifies the relevant literature on the use of fund-raising,and collects data on the use of fund-raising of GEM companies.Secondly,this paper chooses Cixing Stock as the research object,uses chart analysis method to study the use of its raised funds,and exposes its problems from four aspects: the direction of the raised funds,the progress of investment,the use of over-raised funds and information disclosure.The main causes of the problems are as follows: changes in the external market environment lead to unsalable products;imperfect laws and regulations on the use of fund-raising;inadequate supervision by regulatory authorities;lagging behind the examination and approval system of fund-raising;imperfect corporate governance structure in family enterprises,leading to dominant shares;imperfect investment decision-making mechanism,lack of risk response measures;and the management economy of companies.The battalion capacity is insufficient.Then,from the company's overall income,the specific project income,the company's financial indicators three aspects of analysis of the use of Cixing share-raising funds,found that Cixing shares in the first few years after listing promised project income far less than expected,its profitability,growth capacity is not satisfactory.Finally,aiming at the problems existing in the use of funds raised by Cixing shares,this paper extends to the whole GEM company,and puts forward some suggestions for improvement: for the regulatory authorities,we should improve the laws and regulations of fund raised,and secondly,we should strengthen the supervision and punishment,improve the examination and approval system of fund raised;for Cixing itself,we should first continue to implement strategic transformation,and secondly,we should continue to implement strategic transformation.Improve the company's governance structure,check and balance the dominance of one share.Finally,we can improve the investment decision-making mechanism,strengthen the feasibility analysis of investment projects,and enhance managers' operational ability.The conclusion drawn in this paper is that there are some problems in the use of the fund raised by GEM.The second is that improper use of the fund raised will have an impact on the company's performance.The third is that the business of Internet and intelligent equipment of Cixing shares has developed well and the company is developing towards diversification.The above research not only excavates the use effect of Cixing's share-raising fund and the reasons for the existing problems,but also provides reference value for other companies and relevant departments.