Research On Convertible Bond Financing And Performance Of Listed Companies

As an innovative financial instrument,the convertible bond has the characteristics of both bonds and stocks.In recent years,particularly in 2017,it has received extensive attention and favor from the financing parties and investors,and the number of issuances and issuance scales have doubled.Compared with the maturity of the foreign convertible bond market,the financing method of convertible bonds by Chinese companies started late.With the development of the convertible bond market and the expansion of market size,it brings many scholars worthy of in-depth study.The topic of the domestic theory and research on convertible bonds should be further improved and enriched.In this context,this paper takes the listed companies of the Shanghai and Shenzhen stock exchanges financing from 2006 to 2014 as the research object,and studies the company’s operating performance after financing,short-term and long-term market performance,with a view to the existing Theoretical studies have been supplemented and reference has been made to investment and financing practices and supervision and management measures.This paper uses a combination of theoretical research and empirical analysis to conduct in-depth research on the operating performance and market performance of listed companies after the financing of convertible bonds.The operating performance includes the company’s profitability and debt repayment ability reflected by the financial indicators.The market performance includes the short-term and long-term performance of the company’s stock price.In the empirical part,the comparative analysis method was used.The performance indicators of companies that issue convertible bonds were compared with the industry’s median,horizontal,and profitable companies’ performance indicators,which increased the reliability and universality of the research conclusions.The research in this paper shows:(1)The overall average operating performance of listed companies after the issuance of convertible bonds fell more than the median level of the industry.The greater the company’s performance growth before the issuance of convertible bonds,the higher the shareholding ratio of the company’s largest shareholder,the lower the market value of the company,and the worse the performance of the company after issuance.A listed company may only use the convertible bonds as a disguised equity financing method.It does not choose to refinance convertible bonds to match new investment projects and improve business performance.(2)Within the medium and long-term time span,listed companies that make convertible debt financing have generally achieved better performance than the market index,although the overall performance has shown a downward trend.From an individual point of view,some of the companies whose operating performance has increased are more susceptible to the secondary market.