Research On The Financial Effect Of Er Zhong Restructuring

With the development of the tertiary industry and domestic economic situation is changing,the second industry domestic industry proportion in the national economy reduced,especially domestic heavy machinery manufacturing industry to the national economy contribution rate already produce downward trend,many old industrial enterprise financial crisis,in these companies,China National China Erzhong Group Co.(China Erzhong)financial problems is especially striking.China Erzhong has suffered losses for several years since its listing.In order to get rid of difficulties,the company decided to implement the strategy of delisting and debt restructuring,which was successfully implemented in 2015.Through the analysis of the case of debt restructuring implemented by China Erzhong,this paper discusses the relevant measures of the company in the implementation of debt restructuring,and evaluates its financial performance and effect after the implementation of debt restructuring.In the process of the research,the success of China Erzhong debt restructuring is found,and the ideas can be used as case inspiration to provide reference for other companies in debt crisis to get out of financial difficulties.This article first from the heavy machinery manufacturing industry in the external macro environment and industry characteristics,in China Erzhong,using factor analysis method,the selection of machinery industry in the implementation of debt restructuring of the 10 companies,select its debt restructuring in the first year after the completion of financial performance as sample,from the debt paying ability,profit ability,operation ability,growth ability from four aspects,a total of 13 financial index comprehensive evaluation analysis;In the company’s financial performance in the longitudinal analysis,respectively from sinking,profitability,operation,growth ability,comprehensive ratio analysis(dupont analysis indicators)five aspects to reveal China Erzhong financial performance,based on China Erzhong eight years from 2012 to 2019 financial data contrast,reflects its related to the issues before and after the implementation of debt restructuring;In the analysis of the company’s market performance,the earnings per share analysis method is used to analyze its short-term market price determination ratio,and the BHAR method is used to determine its long-term market performance.Secondly,according to the above analysis,the financial effect of China Erzhong is summarized: China Erzhong enables enterprises to improve corporate performance,reduce corporate debt ratio,turn losses into profits,improve corporate financial structure,and achieve the optimization of resource allocation.Finally,according to the evaluation of the financial effect of the China Erzhong,the corresponding enlightenment is extracted from it,and some experience and Suggestions are provided for companies that also encounter financial difficulties.Through a series of debt restructuring measures,such as transferring accumulation fund to increase capital stock,transferring shares,and adjusting creditor’s rights,duerduofang realizes the "deleveraging" of enterprises,tries its best to get rid of the debt dilemma and resolve the debt crisis.The case of China Erzhong has become a benchmark for China’s heavy machinery manufacturing companies to resolve the debt crisis,providing a good reference for other companies to deal with the debt crisis,and a good example for China’s heavy machinery manufacturing companies to improve their operating capacity and resolve the debt crisis.