Study On The Financial Risk Of Permanent Debt Of Evergrande Group

Capital is the lifeline of the real estate industry,high debt has always been the "survival law" of the real estate industry,relying on high leverage,high debt to achieve scale expansion.But in the face of the reality of deleveraging and tight ening financing pipelines,most developers have to choose the path of slowing expansion and deleveragingdebt.Against the backdrop of continued tightening of property regulatory policies,tightening of financing pipelines,rising financing costs and deleveraging of debt,the real estate industry's financial strength is being severely tested.Sustainable debt business is produced under this background.It is a diversified financing method for real estate enterprises,and is also a bank credit as set.The extra-balance sheet credit business not only satisfies the needs of real estate enterprises to reduce the ratio of assets to liabilities,optimize the capital structure,increase financial flexibility,increase the cash flow of the company,and exp and the channels of financing,but also satisfies the need of banks to avoid losing customers.In 2013,Evergrande Group for the first time in China issued sustaina ble debt financing,real estate companies have been scrambling to try,sustainable debt has become a new star in the capital market.So far,Evergrande has issued permanent debt for nearly six years.In 2017,Evergrande Group began to redeem perpetual debt.This paper adopts the method of literature research and case analysis.By means of law and other research methods,this paper analyzes the comparative cases before and after the issue and redemption of permanent debt by Ever grande Group to understand the basic concept of sustainable debt and the current situation of Evergrande Group's utilization of sustainable debt financing.Based on the financial statements,this paper analyzes the consequences of permanent debt issued by Evergrande Group,and reveals its hidden risks,its subsequent performance and development,its motivation for issuing permanent debt,its dist ribution effect and its impact on corporate debt.In order to make reasonable recommendations.Sustainable debt has become a hot way of financing.This paper discusses the motivation and potential risks behind its business by studying the case of permanent debt financing of Evergrande Group.In-depth analysis,finally through the analysis of the case data,explain,put forward the feasibility of solving the status quo,with a view to help the sustainable development of Evergrande Group,The re search on the innovative financing mode of real estate enterprises is also of great significance,and italsoprovidesa reference for the financial authorities' supervision n and decision-making.