Analysis On The Causes And Effects Of Convertible Bond Financing For Listed Companies

As a hybrid financing channel that combines the three properties of equity,bonds and options,convertible bonds are commonly used in financial markets around the world.With the development of China's economy and markets,in recent years,more and more listed companies have raised money through convertible corporate bonds.Convertible corporate bonds have become a very important form of financing for listed companies in China.Compared with the maturity of foreign convertible bond market development,Chinese companies started the financing of convertible bonds late.With the development of the convertible bond market and the expansion of the market size,convertible bond financing has brought many topics worthy of in-depth study to scholars.The domestic theories and research on convertible bonds should be further improved and enriched.In terms of the structure of the paper,this article first introduces the basic theory and research results of convertible bonds,refers to relevant domestic and foreign literature and summarizes them,as a theoretical support for this case study,and then defines the related concepts in this article.Secondly,in the case study section,briefly summarizes the development and current situation of convertible bond market in China,and then introduces the basic overview of the case.Based on the theoretical basis and the actual situation of the company in this case,it analyzes the motivation of SANY's convertible bond financing.Then use event study after issuing convertible bond market reaction on the company,analyzes the SANY convertible bond financing effects on stakeholders and to specifically analyze the effects of SANY convertible bond financing on stakeholders.Finally,according to the above analysis,relevant conclusions are drawn and appropriate Suggestions are put forward.Through analysis and research,this paper finds that the motivation for SANY's convertible debt financing mainly comes from various aspects such as corporate capital demand,capital structure,financing costs,etc.From the perspective of market response,the market has responded positively to the issuance of convertible bonds of SANY.In addition,the issuance of convertible bonds will have different impacts on funders,investors and regulators.From the analysis of this article,SANY chooses to issue convertible bonds is an appropriate financing method,but it also has negative impacts such as dilution of shareholders' equity and increase of financial risks.Therefore,this paper believes that corporate issuer should consider their own circumstances and choose proper financing methods.Investors,including shareholders and creditors,should pay attention to protecting their own interests.At the same time,regulators should take responsibility for formulating policies and improving laws and regulations,maintain and promote the stable and healthy development of the convertible bond market.