Is the rights issue a good thing or a bad thing (is the stock rights issue a good thing or a bad thing)

Rights issue refers to a financing method that listed companies give priority to issuing new shares to existing shareholders under the proportion of existing shareholders' equity to meet the company's capital needs. Rights issue usually provides new shares to existing shareholders at a lower price, which can increase the company's capital and improve the company's capital strength and solvency.

1. Provide financial support for the company. The rights issue can provide financial support for the company and meet the capital needs of the company's development and operation. The company needs a lot of capital investment to expand production scale, launch new projects and carry out research and development. And can quickly obtain funds through rights issue, improve the company's development speed and competitiveness.

2. Protecting the interests of existing shareholders Rights issue can protect the interests of existing shareholders. When the company needs to increase its capital, if it adopts other financing methods, such as issuing bonds or attracting new shareholders to buy shares, it may lead to the dilution of existing shareholders' equity and affect their rights and interests. Through rights issue, existing shareholders can issue new shares according to a certain proportion and safeguard their own equity ratio and rights and interests.

3. Improve the company's capital strength. Rights issue can improve the company's capital strength. The company's capital strength is very important for its business development. Adequate capital can improve the company's solvency and reduce the debt risk. Through the rights issue, the company can increase its own capital, improve its capital adequacy ratio, enhance its ability to resist risks and lay a solid foundation for future development.

4. Increase the sense of participation of shareholders. Rights issue can increase shareholders' sense of participation. As a shareholder of the company, rights issue can give shareholders the opportunity to participate in the company's decision-making and development according to a certain proportion of new shares. This can not only increase the participation of shareholders, pay more attention to the company, but also allow shareholders to share the benefits brought by the company's development and increase the return on investment.

The rights issue is beneficial to both the company and shareholders. It provides financial support for the company, protects the interests of existing shareholders, improves the company's capital strength, and also increases shareholders' sense of participation. There are also some risks in stock allotment, such as the cost of new shares and the fluctuation of stock price after allotment. In stock allotment, companies and shareholders need to comprehensively consider various factors and make wise decisions.