Most projects of Taihe Group have the characteristics of long development cycle and slow capital turnover. If the enterprise ignores the long-term development plan and does not reasonably arrange the proportion of long-term loans, it will only increase the short-term loans and commercial credit loans, and ultimately cannot plan the proportion of liabilities according to the duration of the project. Make the enterprise face serious bankruptcy and financial risk. In the debt financing structure of Taihe Group, the proportion of short-term current liabilities is much higher than that of long-term liabilities. In 2018, Taihe Group's short-term liabilities accounted for 64% of total liabilities. Short term liabilities require enterprises to have strong solvency. However, Taihe Group's solvency is weak and its financial flexibility is poor, which may lead to financial risk bankruptcy. Too high debt financing to a certain extent shows that the equity financing of Taihe Group is insufficient, and the financing strategy needs to be improved.
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