Research On Financing By Way Of Issuing Convertible Bonds In China’s Listed Companies

Financing is an important part of the company’s financial management, whether a company can obtain a stable source of funding and adequate financial support, which is essential to the operation and development of the company. Especially, China’s economic has been rapidly developed recently, most companies need to finance a lot of money in order to expand the production scale of the enterprise itself or integrate the industry, otherwise, companies will face the risk of cash-strand break or a shortage of funds which can lead to the company’s financial crisis. Therefore, a variety of financing tools are appeared in the capital markets to meet the financing needs of different companies. Traditional financing instruments can be divided into equity financing and debt financing, but with the development of the economy, relying solely on the equity financing or bond financing can not meet the requirements of economic diversity and complexity, therefore, financial derivatives come into being, and convertible bond is one of them.The convertible bonds are the securities that have the nature of both of the bonds and the stocks, companies can obtain the unique advantage when they use convertible bonds to finance. Generally speaking, the use of convertible bond financing can reduce the cost of financing, expand the scale of financing and delay shareholders’ equity dilution, therefore, convertible bonds financing is favored by many companies. Since from1998when Chinese first convertible bond was appeared, the pace of convertible bonds development continues to accelerate, especially in recent years, Chinese regulatory authorities continue to push forward the development of bond markets, listed companies choose convertible bonds financing more and more. Therefore, further study of the convertible bond and the role it plays is significant to theory and practice.Therefore, this article focuses on researching on convertible bonds financing problems of listed companies in China, and the writing purposes are as following:First, compared to equity financing and debt financing, what are the advantages of convertible bonds financing for? Second, if Chinese listed companies want to issue convertible bonds to finance, what financial situation should the companies have? Third, after the listed companies issue convertible bonds, how the performance of the companies change? Based on the above three purposes of writing, this article introduces the development of domestic and foreign convertible bonds, and the basic knowledge of convertible bonds; and then analyzes the basic theory of the convertible bonds, which includes the intrinsic link between convertible bonds and corporate governance structure as well as corporate capital, and the strength and weakness of convertible bonds financing; again, this article briefly introduces the problems faced by the convertible bonds market in our country and the solutions we should take; Finally, takes Tsingtao Brewery Co., Ltd. as a case to analyze in details in order to provide practical and theoretical guidance to listed companies in the future.