Analysis Of Causes For Default Of Enterprise Credit Debt In Dandong Port Group

Corporate credit bond is an important part of the bond market.In recent years,as the rigid payment of credit bonds has been broken,more and more corporate credit bonds have defaulted.The Dandong Port Group selected in this paper is one of the typical cases of credit bonds defaultTaking Dandong Port Group as an example,this paper makes a detailed analysis of its default causes.This paper first analyzes the company's bond issuance and discusses its motivation for issuing bonds.Dandong Port Group's early motivation for issuing bonds is mainly to satisfy its expanding investment demand,reduce financing costs and optimize debt structure,but its late debts issuance purpose is to borrow new debts to repay the due onesThrough a comprehensive analysis of Dandong Port Group's financial and business conditions and a comparative analysis with other port companies in the region,this paper attributes Dandong Port Group's bond default to both external and internal reasons.The external reasons mainly include the economic downturn in the hinterland of the port,the industry downturn,and the deterioration of the financing environment as well The internal reasons mainly include the company's declining profitability,deteriorating cash flow,unreasonable corporate debt structure,aggressive dividend policy and negative impact of its controllers.The Dandong Port Group's bond default has adverse effects on the company's subsequent profitability,rating level and corporate governance level.Bond defaults should be properly handled,otherwise the company's operations and even its survival will be affectedBy studying the case of Dandong Port Group,the paper summarizes the company's credit bond default causes and provides investors with a method to study the real financial situation of the enterprise so as to avoid similar high risk investment targets and decrease investment risks.It also reminds enterprises to properly borrow according to their own operation conditions so as to avoid a liquidity crisis.