Royal Bank shares: additional solutions to the capital bottleneck

Sina tip: This article belongs to the Research Report column, only for the analysis of a stock of personal views and views, and the unofficial news report, Sina does not guarantee its authenticity and objectivity, all relevant to the stock of effective information to the Shanghai and Shenzhen Stock Exchange of the announcement as prevail, please investors pay attention to risk.　　The Yangtze River Securities Horse First article event: The Royal Bank shares recently issued the Non-public issue stock plan, the issue quantity does not exceed 50 million shares not below 20 million shares, the issue price is not less than 14.45 yuan, this directional additional placement mainly throws into the ATM network construction project. Comment: We have mentioned in the report several times before, Bank of the Bank of the joint operation of ATM to advance funds to make ATM, and then through cross-border withdrawals and banks into the model to achieve profitability, the profit model determines the ATM operation to accelerate the layout of the need for ample cash flow, and the Royal Bank shares in the first half of 2009 after the IPO ( Initial public offering) funds will face a certain financial bottleneck. We can see this in the context of the changing trends in financial costs over the years and the negative cash flows from free activities (operating cash flows and capital expenditure differences). If the targeted issue can be implemented, the Royal Bank shares raised funds will exceed the size of the IPO financing, which will undoubtedly significantly improve the Royal Bank's current cash flow is more tense situation, and in cash to ensure that the ATM operation to accelerate the layout of the obstacles to basic cleaning. The non-public offerings mentioned in the next two years to raise funds to add more than 8000 ATM cooperative operating equipment, the Royal Bank joint-operation ATM Holdings will be more than 15406 units, its size is about 3 times times the current. Based on this, we have raised the "prudent recommendation" to "recommend" to the Royal Bank's share rating.