The Impact Of Market-Oriented Debt-for-Equity Swap On The Performance Of Difficult Enterprises

Due to the cyclical and structural problems of macro-economy,the development of China's real economy is facing great difficulties and challenges.Most enterprises have debt problems and operation difficulties.The problems of the real economy need good ways to solve so that the real economy can resume its good development.Debt-for-equity swap,as the most important means of debt restructuring,was put forward again in 2016 after the policy-oriented debt-for-equity swap in 1999.The Guiding Opinion on Market-oriented Debt-for-Equity Swap points out that market-oriented Debt-to-Equity Swap has strategic significance for the healthy long-term development of enterprises,but the implementation effect of market-oriented Debt-for-Equity Swap is not as expected.Therefore,how to play the positive role of market-oriented debt-for-equity swap in difficult enterprises has become a hot topic.This thesis is a case study of "Yunnan Tin Industry-CCB" project.Yunnan Tin Group is an enterprise with perfect non-ferrous metal industry chain.Its market-oriented operation mechanism has been imitated successively by other debt-to-equity swap enterprises,so it has strong typicality and generalization.In order to explore the impact of market-oriented debt-for-equity swap on the performance of difficult enterprises,this thesis firstly analyzes the current situation of the plight of the non-financial enterprise sector,which needs to be solved urgently.Secondly,this thesis elaborates the logical relationship between the proposition of market-oriented debt-for-equity swap and the predicament of enterprises.Thirdly,based on the basic financial analysis,Z-Score analysis and EVA analysis,this paper analyses the changes of performance before and after market-oriented debt-for-equity swap.With DuPont analysis,Chain substitution analysis and debt structure analysis,thesis explores the path of market-oriented debt-for-equity swap influencing performance,and points out the possible constraints on future performance so as to improve the performance of difficult enterprises through market-oriented debt-to-equity swap.The conclusions of this thesis are as follows:1.Market-oriented debt-for-equity swap has a positive effect on the performance of difficult enterprises.2.The key to the market-oriented debt-for-equity swap is to improve the operational efficiency of enterprises: The short-term performance of Yunnan tin industry is driven by the change of debt stock,structure and profitability.The motivation of long-term performance improvement is the improvement of enterprise's profitability.3.There are still some problems in the operation of market-oriented debt-for-equity swap,which restrict the improvement of long-term performance of difficult enterprises: Firstly,moral hazard exists in enterprises;Secondly,the phenomenon of "soft budget constraints" and the recovery of debt ratio make the debt risk migrate to the future.Finally,the cost of time and money are higher,which is not conducive to long-term performance improvement.Based on the positive role of market-oriented debt-to-equity swap and the existing problems in the case,the dissemination suggestions are put forward from policy design and specific scheme.We should not forget our initial intention and move forward,make effective use of market-oriented debt-for-equity swap,help the real economy to reduce its burden,restore its vitality,prevent systemic financial risks,and promote the healthy and sustainable development of social economy.