Category: Money tips Release Date: 2007-06-24
Is to determine the value of stock is an important factor, but supply and demand relationship is another important factor. While in the long term value is more important, but on a two-time view of supply and demand must not be ignored.
In the analysis of the company's expansion pressure can be from several different aspects to grasp.
1. The proportion of non-tradable shares. If the non-tradable shares quite a high proportion of non-tradable shares of some companies such as the ratio even in Major Holders even after more than 90%, such companies will face in the future flow of great pressure, and even the next year is likely to flow doubling the number of shares.
2. Company's prospects. Unclear if the company's growth prospects, products, intense competition, even if the stock price is low, a major shareholder is possible fully sold.
3. Second Board companies. The Second Board companies are characterized by smaller and fundamental to the overall equity of private-based. It is precisely because smaller equity position in market higher, major shareholders also have a greater desire to sell.
4. Shares. Of new shares after the share reform is the issue of new shares. Such new shares with the previous shares are fundamentally different, that is, tradable nature. Now shares are tradable, according to the "Company Law", the old stock after the listing as long as a year in circulation. Although the IPO is now, when controlling shareholder ( "small non-" exception) are committed to three years without reduction, but its future may or may not true. In fact, the present flow of new shares with the share reform program similar, but these new shares of non-tradable shareholders is not required Major Holders can get the right flow. So, right now is not to stock shares can change the flow of tradable shares in batches.
5. Additional or allotment. Many listed companies do have good projects, but they are lack of funds, the financing proposed by the applicant companies will be more and more. For these so-called future growth to ensure the company can wait. Equity financing will increase the effectiveness of the project has not shown, it should wait until the project was near completion, again to consider.
The whole process will be fully tradable market within three years, the progressive realization, during which we had to conduct valuation of the company's full circulation pressure on an important position to prevent us from finding a good stock but because the pressure of expansion failed.
A simple way is to look for a very low proportion of non-tradable shares of the company, because the prospects for major shareholders can not give up, so there will be no expansion pressure. Another approach is to find a second best commitment to the controlling shareholder. While these commitments and there is no legal efficiency, but we prefer to believe that this commitment. (Pan Weijun)
