Study On The Motivation And Economic Consequences Of Perpetual Bond Financing Of Beijing Urban Construction

The real estate industry plays an important role in China's national economy,with the characteristics of large capital investment and long recovery cycle,but the development of the real estate industry is largely limited by financing.National laws and regulations and macro-control,as well as the tightening of bank loans in the external environment will hinder the financing,and enterprises sometimes face the problems of financial leverage imbalance,high asset liability ratio,and poor refinancing ability in the internal structure.At this time,perpetual debt emerges as the times require.On the one hand,it can adjust the capital structure of the company and reduce the asset liability ratio.On the other hand,it can improve the refinancing ability of the enterprise and make the cash flow of the enterprise more sufficient.Perpetual bond is a kind of mezzanine financing tool,which has the dual attributes of "equity" and "bond".It has the characteristics of long term,low cost of capital and non dilution of shareholders' equity.Its emergence is conducive to improving the financing demand of the real estate industry.Wuhan Metro issued China's first perpetual bond in 2013.The financing mode of perpetual bond has just developed in China,and there is little research on its application in China.Moreover,due to the particularity of real estate industry financing,the author selects Beijing urban construction,a representative real estate enterprise,to study its financing behavior of issuing perpetual bond.Through sorting out the domestic and foreign literature on the issue of sustainable debt financing,on the basis of combing the background,scheme and process of Beijing urban construction issuing sustainable debt,and then according to the current accounting standards and tax policies,this paper introduces the accounting treatment and tax treatment of Beijing urban construction sustainable debt financing,and then through the problems in the financial status and financing status of Beijing urban construction,this paper analyzes the issue of sustainable debt Based on the analysis of the causes,this paper further analyzes the economic consequences of the financing of the sustainable debt from the four angles of cost,benefit,risk and market.It is found that the issuance of sustainable bonds by Beijing urban construction can meet the capital demand,reduce the asset liability ratio,reduce financial expenses and improve the credit rating.However,while optimizing the financial structure,the financial risks behind the company cannot be ignored.In this paper,case study and event study are used to study the economic consequences and risks of Beijing urban construction issuing perpetual bond financing.On this basis,some suggestions are put forward from the perspective of issuing enterprises and investors,hoping to provide some reference for the real estate enterprises that carry out perpetual bond financing later.