Analysis Of Baoqianli Bond Default Case

In 1981,China began to restore its national debt.After more than 30 years of development,the bond market continued to improve.The circulation and volume of transactions increased exponentially.The overall scale also achieved sustained growth.These achievements cannot be separated from the government's policy support,but The government's support also provides implicit guarantees for the bond market,so that the credit risk of the bonds is not fully exposed.Until the "11 Super Day Debt9" in 2014,there was a material breach of contract,and the domestic bond default incidents appeared one after another.This shows that the government's implicit guarantees gradually withdraw from the market,and the credit risk of bonds is transferred to investors.This is also the beginning of China's bond market.As a sign of maturity,and due to various reasons such as economic transformation,bond default events are gradually normalized.Therefore,studying the causes behind bond defaults is of great significance to prevent bond default risk and risk control of enterprises.This paper takes Jiangsu Baoqianli Video Technology Group Co.,Ltd.as the research object,and tries to explore the causes behind its default by studying the non-publicly issued "16 thousand miles 01”corporate bond default events,and form inspirations and suggestions for enterprises.The risk management has reference significance.The research ideas of this paper are as follows:Firstly,we will sort out the development of China's bond market and the reasons for bond default,summarize the research results of relevant scholars.Then introduce the current situation of China's bond market and bond default,and combine the actual cases to introduce the development history and company of Baoqianli.The situation of bonds from the issuance to the post-default period lays the foundation for case analysis.Then this paper analyzes the financial risk of Bao Qianli from the aspects of corporate solvency,profitability,operational capability,cash flow,etc.,and then explores the hidden financial risks from the non-financial factors,and then analyzes the existence of Baojili's corporate strategy and corporate governance.Hidden dangers,and finally use this as a warning to advise companies on how to prevent debt crisis from a financial perspective,corporate strategy perspective and corporate governance perspective.Through the research and analysis of this paper,it is found that the bond default in Baoqianli is mainly caused by its long,-term financial risks.The company's operating conditions are good,but the company's excessive investment expansion makes its long-term net cash flow of its operating activities and investment activities negative.A large amount of borrowing to maintain normal operation,while the company's corporate strategy has been mistaken,and the corporate governance mechanism is not perfect,and hidden risks are buried.This article further forms a case inspiration:First,to strengthen financial risk prevention,we must do a good job of cash flow management;second,the gambling agreement is a double-edged sword,must be carefully signed;third,enterprises must focus on their own main business,Investment should not be excessive.Fourth,enterprises can optimize the shareholding structure by expanding the proportion of shares outstanding and developing institutional investors to prevent the manipulation of major shareholders.Fifth,the company should improve the internal control environment,conduct comprehensive risk assessment,and strengthen internal The way of supervision improves internal control.