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Learning about knowledge allotment


									Learning about knowledge allotment
Placement of shares to the original shareholders of listed companies
issue new shares to raise funds act.

By convention, when the company's allotment of new shares subscription
rights in accordance with the existing equity shareholders of the
ratio between the original allocation, the original shareholders have
preferential subscription rights.

The conditions of allotment:

(1) The previous issue of shares has been fully subscribed, raising
funds with favorable results;

(2) listing more than three full fiscal year, the last 3 consecutive

(3) company in the last three years, no false financial and accounting
records or material omission;

(4) of this Rights Issue to raise funds, the company forecast a net
return on assets should meet or exceed the level of bank deposit
interest rates over the same period.

(5) shares of restricted common stock placement, placement of objects
registration date for the equity of companies registered shareholders;

(6) the total number of issued shares of a placement of shares shall
not exceed the company's previous shares issued and fully subscribed
after the 30% of the total number of its shares, the company will
raise funds for the allotment of this key national construction
projects, technology projects, it may not be restrictions on the
proportion of 30%.

When issuing new shares Number of shares held by shareholders in order
to maintain price (below market) distribution warrants.
Placements is a major characteristic is that the price of new shares
issued in accordance with the announcement of the stock when the
market price for a certain determined discount processing. The
discount price is a bid to encourage shareholders to subscribe. The
time when the market environment is unstable, to determine placement
of shares price is very difficult. In normal circumstances, the price
of new shares issued when the stock market at an issue price of Rights
Issue 10% discount to 25%. Theoretical ex price before the
announcement of additional shares of stock and issue new shares of the
weighted average price, it should be the placing of new shares after
the stock price.

Placements are not dividend

Dividends to shareholders of listed companies the return on
investment, which are characterized by: Listed companies are paying,
with shareholders who are harvesting, and harvest the shareholders of
listed company's operating profits, the dividends of listed companies
is built on the basis of operating profit , no profit no dividends can
be divided into. Dividends of listed companies usually have two forms,
one is to send cash dividend, that a listed company will at some stage
(usually one year) part of the profits in cash back to shareholders,
which shall be return on investment to shareholders; other is the
bonus issue, which will be a cash dividend to shareholders into the
capital to expand production in the coming year give to shareholders.
The allotment is not built on the basis of profit, as long as the
shareholders would rather, if the business has incurred losses of
listed companies can also share placements, obtained by listed
companies, shareholders are paying those. Shareholders additional
investment, joint-stock companies to obtain capital to replenish
capital. Although the placement of shares held by the shareholders
after the stock has increased, but it is not the company's return on
investment to the stock, but the additional investment as a form of
Allotment Option is exercised with, get paid bonus shares, according
to a certain percentage of the price to buy a certain stock, that
stock should be given more pocket. Allotment diluted, Tianquan or
paste right, pay attention to the market atmosphere. In bull market,
share placements, the bigger the chance Tianquan, cheap to buy the
stock may have greater benefits. If the trend of weakening, appears
below the allotment price of diluted shares, then the losses will be.
If you can in the market placement of shares with a price lower than
the purchase price of the stock, placing will be meaningless.

Operate as usual allotment to buy shares, so long as to be in
accordance with allotment allotment price and the number, fill in pay
can be, no one said allotment warrants. If a stock dividend has
another allotment, you can only get dividends, rather than placements,
as long as the payment of allotment do not buy, share placements to be

Rights Issues Frequently Asked Questions

Allotment shall be repayable on it?

Not. According to relevant provisions exchanges, placements
subscription on R +1 date, the subscription period is usually 10
working days (adjustable), such overdue payment processing for waiver
of right to allotment, payment can not supplemented.

Accordingly, prospective investors should note that allotment of
information the newspaper notice, including contributions of time
allotment, and timely payment. So as to avoid unnecessary trouble or
to avoid unnecessary losses.

Placements can be withdrawals of contributions it?

According to SSE provisions allow withdrawals that day subscription
Placements What payment fee?

Investors subscribe for placement of shares without any fee.

Placement of shares in the "piecemeal stocks" do?

According to the provisions of the Shenzhen Stock Exchange, placement
of shares arising from the piecemeal or fragmented stock warrants,
sorted by the number of size, number of cycles carry a small number of
large shareholders in order to achieve the smallest units in a share

How can we know the placement of shares is valid?

As the subscription is limited allotment of time, over the timing of
payments shall not repay the opportunity to cause losses to investors,
therefore, whether the allotment is confirmed after the subscription
is very important. Shenzhen allotment of funds investors should see
the account in cash the next day is less, warrants are being drawn to
the; Shanghai stock market placement of shares to investors in the
next day, where Print statements broker to determine the subscription
is valid.

Placing the number of errors input how to do?

Investors in the placement of shares subscribed shall, if found to
have been commissioned into the exchange list of the host computer is
wrong, as commissioned by the number of shares over the subscription
limit withdrawals, then you can re-commissioned.

Whether the payment by the broker on behalf of the allotment?

Can. Many brokers provide such services. But to provide this service
brokers, investors generally will sign a "proxy investors go
through placement of shares agreement." Have to remind the
allotments or payment services.

Subscription placement of shares is "buy" or

The placement of shares in Shenzhen subscription settings the computer
system in the exchange, its trading direction for the "buy"
commissioned; Shanghai Stock subscription warrants placement of shares
traded in the direction of exchange auction declare limits to
"sell" order completed.

Placement of shares divided into two kinds of paid placement of shares
and bonus shares.

1. Paid placements: The company handling the cash capital increase,
shareholders may subscribe according to stake money stock. Such
placements ex, except that the "new shares subscription

2. Unpaid placements: well-managed company made money, according to
allocation of surplus general meeting resolution. The distribution of
interest earnings with the Second Law and Rights Issue, with interest
free shareholders to receive cash pursuant to equity ratio is
generally what we call the ex-dividend. The placement of shares
pursuant to equity ratio is shareholders to receive shares free of
charge. Both said the free, the shareholders do not have to spend
money on subscription. Such placements ex, in addition to the
"surplus distribution rights."

Involved in placements Notes

Placement of shares of listed companies incorporated under
development, in accordance with relevant regulations and relevant
procedures, the original shareholders, the further issue of new shares
to raise funds act. Investors in the Subscription required to read
before allotment of listed companies, "placement of shares
Manual", know the specific time allotment payment, subscription
methods and so on.

1, methods will be the public shareholders can subscribe for the
subscription period, with personal identification, shareholders
account card, Shanghai Stock Exchange to their designated transaction
broker office, managed brokerage office in Shenzhen to report
subscription allotment, while capital account to ensure sufficient
funds. Investors can personally commissioned by the way, can also be
commissioned by phone, a variety of ways such as self-commissioned
subscription form and commissioned the same as buying and selling

Investors may subscribe for multiple declarations, each declaration to
apply for the total number of subscription rights offering may not
exceed its allotment amount. Of course, investors can subscribe to
their own decisions whether some or all of the Placing.

2 to calculate the number of Shanghai stock market allotment
provision, placing limits the number of shares as of the date of
registration the number of shares held multiplied by the ratio will be
after the public placement of rounded and less than part of an rounded
by rounding. Shenzhen provides that part of allotment no less than an

3, how to confirm the validity of allotment? As the subscription is
limited allotment of time, overdue payment by giving up equity deal
with. Therefore, placements are confirmed after the subscription is
very important. Placement of shares to investors in the brokerage
office the next day print Jiaoge Dan, view the financial account is
short of cash, to determine subscription is valid. Here, also reminded
investors to participate in placements is best not to catch the last
bus, so that if operational errors, no time to remedy.

4 Subscription share placements are "buy" or
"sell"? The placement of shares in Shenzhen subscription
settings the computer system in the exchange, its trading direction is
a "buy"; Shanghai Stock Exchange with shares sold with
access to stocks, rather than some investors understand the placement
of shares is to pay the money, should to "buy" the wrong

In operation, the SSE agency placements lead underwriter in an opening
call auction on the allotment price to buy a large number of
declarations with equity, and investors scored a "sell"
matched pairs. If investors mistakenly knock allotment to declare a
"buy" commissioned, SSE directly to the host computer, as is
often the time lag in reporting the lead underwriter for a large pay,
little chance of natural turnover, even if the placement of shares
traded, then declared, wrong direction because of the sale, allotment
payment is still a failure, the investor must be on the second day of
"reverse operation" means "double sell"
commission, payment for proper placement of shares.

5. What is "reverse engineering" and "double sell"
commissioned it? Can now give an example to illustrate: an investor to
participate in allotment payment, mistakenly hit a "buy"
1,000 shares, if found to be in the second day in time (the period of
contributions still allotment) declared "sold the "2000
stock can, misuse of the original" buy "commission to
correct to" sell "commission, which is called" reverse
operation ", a false statement to the original 1,000 shares
allotment to delegate the right to declare the direction of"
selling the "2000 stock, which is called" double sell
", if the investor is" reverse operation ", but
no" double selling "commission, then allotment payment is
still a failure.

6, when the stock market investors, the allocation of payments after
making placements, often found in the distribution of shares has yet
to arrive, was very anxious. In fact, the allotment was not
immediately arrive to. The public shares will be allocated shares
traded date, contributions will be the end of the second allotment,
the company published a notice of change of shares, by the stock
exchange arrangements will be announced.

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