Case Analysis On The Bond Default Of Win Time Energy

In recent years,with the development of China's economy and the rapid development of the bond market,issuing bonds has become an important way of financing for enterprises.However,the great-leap-forward development of the bond market also brings some problems.Since March 2014,the corporate bonds issued by Shanghai Chaori Solar Energy Technology Co.,Ltd.officially declared default,bond defaults occurred frequently in China,and the number and amount of bond defaults in 2018 reached the highest level in history.The main body of bond default has also spread from private enterprises to local state-owned enterprises and even central state-owned enterprises,and the enterprises involved are all over a variety of industries.The frequent occurrence of bond defaults not only has a great impact on the financial market,but also has a great impact on the direct financing function of enterprises.Therefore,in order to prevent bond default,maintain the stability of the bond market and protect the interests of investors,we urgently need to analyze the root causes of bond default and explore effective countermeasures to prevent bond default from the source.Chinese scholars' research on bond default is mainly through empirical methods to study the operation law of the whole bond market from a macro perspective,while the study of case analysis is lacking.This paper selects the bond serial default case of A-share listed company Wintime Energy Co.,Ltd.to study,the number of corporate bond default is large,the amount is huge,which is typical in the default cases in the bond market.By analyzing the root causes and economic consequences of bond default of Wintime Energy,this paper gives some enlightenment to issuers,investors,rating agencies and regulators.It is hoped that it can provide a reference for improving China's bond market system and improving the risk awareness of issuers and investors.The main content of this paper is divided into the following four parts:The first part is the introduction and theoretical overview.Firstly,based on the background of the frequent occurrence of bond default after the rapid development of China's bond market,this part expounds the research background and significance of the article.After combing the research results of scholars at home and abroad,it introduces the research content,research methods and basic framework of this paper.Subsequently,the article explains the relevant concepts of bond default,and expounds the various influencing factors and related theories of bond default from a theoretical point of view,which provides a theoretical basis for the following analysis process.The second part is the case introduction,which first introduces the basic situation of Wintime Energy Co.,Ltd.,the main body of this case,and then sorts out the number and amount of bank loans and bonds,which are the main interest-bearing liabilities of Wintime Energy.Finally,according to the chronological order,the whole process of bond default of Wintime Energy is reviewed,and the disposal measures after default are summarized.The third part is the analysis of the causes and consequences of the default of Wintime energy bonds.Bond default is caused by a variety of reasons.in order to deeply explore the root causes of Wintime energy bond default,this part selects four breakthrough points: market supervision,credit rating,enterprise industry and internal reasons.analyze the causes of Wintime energy bond default.Through the analysis,it is found that the internal reason is the root cause of Wintime Energy default,which mainly includes: first,the expansion strategy is too radical,which leads to the enterprise borrowing wantonly;second,the amount of interest-bearing liabilities is too high,which makes the enterprise bear huge repayment pressure;third,the restricted assets account for a relatively large proportion,which reduces the liquidity of the enterprise;fourth,the risk awareness is weak and the preventive measures can not be taken in time.In addition,this part also analyzes the impact of Wintime energy bond default on various stakeholders.For the issuer itself,the default further worsened the financial situation of the enterprise,and the stock price fell significantly.Not only that,the refinancing ability of issuers has also been greatly affected,which is not a small blow to Wintime Energy's future debt repayment and continued production and operation.For other stakeholders,the credibility of Wintime's affiliated companies has been damaged,and the financing function cannot be used properly in the short term;the enthusiasm of investors in the bond market has been hit,which may reduce the enthusiasm for investment in the bond market as a whole;the credibility of the rating agencies will be seriously damaged,and the value of rating reports will decline for users.The fourth part is the conclusion and enlightenment of the case.With the continuous accumulation of risks in China's bond market,seeking a solution has become an urgent problem to be solved.Through the analysis of the default cases of Wintime energy bonds,this paper draws the following conclusions: first,the enterprise's own reason is the root cause of this default;second,the rating agencies fail to perform their duties and do not play a warning role to investors;third,China's bond market supervision mechanism remains to be improved.According to the above conclusions,this paper draws relevant implications,including: issuers should formulate reasonable development strategies and establish an effective risk early warning mechanism;bond investors should improve their investment literacy and enhance investment vigilance;rating agencies should improve the standardization of credit rating and consider the introduction of double rating mechanism;regulators should unify regulatory standards and strengthen the supervision of information disclosure.