Research On The Identification Of"Zombie Companies"and The Exit Path Of Debt Restructuring In China’s Heavy Machinery Industry ——A Case Study Of China Erzhong Heavy Industries

At present,our country is in a critical stage of supply-side structural reform.The focus of the reform is "de-capacity".Because “zombie companies” hinder the normal development of China’s economy and the transformation and upgrading of enterprises,the solution to the problem of “de-capacity” lies in the exit of “zombie companies”.To solve the problem of "de-capacity" lies in effective realize the exit of "zombie companies",which could help companies to rid financial difficulties and improve their profitability.Our countary’s heavy machinery companies have been overcapacity for a long time,and the problems caused by "zombie companies" have become more and more serious in recent years.In this context,this article adopts the method of case analysis.This artical takes the leading company in the heavy machinery industry,China Erzhong Heavy Industries as the case object.And constructing the identification method and exit path selection for the “zombie enterprises” in the heavy machinery industry."De-capacity" in the heavy machinery industry has important practical significance.The core research question of this article is: How can debt restructuring help zombie companies in the heavy machinery industry get out of trouble? In order to explore this issue,three argumentation questions are raised:（1）How to identify "zombie companies" in the heavy machinery industry?（2）Why difficult companines in the heavy machinery industry choose debt restructuring to withdraw from“zombification”?（3）Can debt restructuring improve corporate value? In order to solve the problem,after comprehensively analyzing domestic and foreign literature,this article has formed a clear theoretical system on the identification method and exit path of "zombie companies".However,after sorting it’s found that our country’s research on “zombie companies” is mainly focused on empirical research in the whole industry.In a small amount of industry analysis is also concentrated on resource-intensive companies such as coal and steel.There is almost no analysis on the heavy machinery industry.Firstly,this paper uses the existing identification methods to identify fifty listed heavy machinery companies.On this basis,finding out the existing identification methods has ignored the importance of our government’s subsidies and bank credit support on the formation of "zombie enterprises".Combining with the "blood transfusion rate",an identification index suitable for the heavy machinery industry has constructed.The identification process of China Erzhong Heavy Industries is analyzed in detail.Secondly,analyzing the exit path of "zombie companies" from the company’s development direction,financial status,and operating status.On this basis,we analyze the exit path of China Erzhong Heavy Industries: debt restructuring.Finally,Du Pont analysis method and event research method are mainly used to analyze the financial effect and market performance of China Erzhong Heavy Industries.Come to the same conclusion: debt restructuring helps company get out of debt trouble.This article puts forward specific suggestions for the identification and withdrawal of "zombie companies" in the follow-up treatment of heavy machinery industry.