Because the CSRC stipulates that the price of private placement is not lower than the average price of 20 trading days, the private placement is generally targeted at qualified institutions or major shareholders, and the stock price is not depressed. When conducting private placement, these institutions or major shareholders will get shares at high prices, which increases the risk and difficulty of lifting the ban on the stocks behind them. Therefore, institutions and major shareholders should suppress the stock price, buy shares at a lower additional price, and then release the performance of enterprises, in order to achieve the purpose of reducing their holdings at a high level after lifting the ban.

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Precautions:

Under normal circumstances, increasing the stock will have a positive impact on the stock. Generally, a fixed stock increase will have a certain supporting effect on the stock price, which can reduce the stock price decline. In addition, listed companies will do a good job in the success of stock growth in the current period, which is also conducive to the rise of stock prices. After the success of the fixed stock increase, the funds can be used to invest in projects with better returns, thus expanding the profits of enterprises, which is likely to cause the stock price to rise.

If the fixed income of listed companies does not effectively bring benefits and development to enterprises. Then it will be questioned by market investors, which may lead to a decline in stock prices.

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