The Influence Of Convertible Bonds On Corporate Financial Performance

The operation and development of enterprises cannot be separated from the support of capital.Refinancing can provide listed companies with the capital they need for their development,and also help enterprises obtain the best capital structure.The refinancing methods of listed companies in China mainly include private placement,convertible bonds and rights offering,etc.Listed companies should make clear the purpose of enterprise financing according to the policy guidance,market conditions and their own characteristics,and choose the most suitable way to raise funds among various refinancing methods,so as to promote the healthy development of enterprises.Qiong energy,the first convertible bond in China,came into being in Hainan in 1991.However,the first convertible bond in the real sense,Bao an convertible bond,was issued on the Shenzhen stock exchange in 1992.As the final conversion rate is only 2.7%,the company is under great repayment pressure,which also hinders the development of convertible bonds in China to some extent.With the continuous introduction of relevant policies and the improvement of laws and regulations in subsequent countries,China's convertible bonds experienced rapid development around 2003.However,due to the imperfect market,bond issuing enterprises are not able to resolve risks.Therefore,the development of convertible bonds is not very smooth.However,the new refinancing rules introduced in February 2017 and the credit purchase model for convertible bonds introduced in September of the same year pushed convertible bonds to the high point of development again.According to statistics,there are a total of 77 enterprises issuing convertible bonds in 2018,which is three times more than that in 2017.Therefore,under the guidance of policies and in the new era,it is worth exploring how convertible bond financing will affect the performance of enterprises.Therefore,this paper chooses the first Baoxin convertible bond to complete the perfect delist in the era of credit application and purchase for in-depth analysis.This paper mainly analyzes the impact of convertible bond issuance on corporate financial performance.Firstly,this paper reviews the domestic and foreign studies on convertible bond financing,studies the previous views on the mechanism relationship between convertible bond and corporate performance,and analyzes the current situation of China's convertible bond market.Second,comprehensive existing research and related theories of convertible bond financing and financial performance is put forward relevant assumptions,with 2004 to 2016,convertible bonds as sample of enterprise,establish a multivariate regression model,respectively,to issue and turn around time nodes for regression analysis,the results show that the convertible bonds issued after the enterprise performance fell,after the convertible bonds convertible corporate performance also fell.Finally,this paper introduces the first Baoxin convertible bond after the introduction of the new refinancing rules.It first analyzes the Baoxin convertible bond and then calculates the comprehensive performance score of Baoxin software.It also analyzes the impact of Baoxin's convertible bonds on corporate performance from the aspects of profitability,growth ability,operation ability,debt paying ability and capital structure.The research results show that after issuing convertible bonds,the short-term comprehensive financial performance score of enterprises will decline,and with the completion of equity conversion,the comprehensive financial performance of enterprises will have a strong upward trend.