Case Analysis Of Zhongtian Technology’s Repurchase Of Shares For Convertible Bonds Conversion

Share repurchase refers to the behavior that listed companies use their own funds or through financing to buy back the company’s circulating shares in accordance with the prescribed procedures.As an important financial activity in recent years,share repurchase has gradually gained the attention of the capital market.Favored,listed companies have also begun to conduct share repurchases one after another.In October 2018,the "Company Law" made new revisions.Among them,there are two revisions on the purpose of share repurchase.One is to allow listed companies to repurchase shares to convert the convertible bonds issued by themselves,and the other is to maintain the company’s Listed companies may repurchase shares when deemed necessary by value and shareholder equity.This revision is the first combination of share repurchase and convertible bonds in my country’s laws and regulations,which means that the government encourages and supports listed companies to conduct convertible bond financing while repurchasing shares.Since the introduction of new regulations on share repurchase in October 2018,as of December 2020,nearly 80 domestic listed companies have announced that they will repurchase shares for the conversion of convertible bonds.Although in real life,the number of listed companies participating in the new regulations on share repurchase is increasing,but whether the goal of these companies to repurchase shares for the conversion of convertible bonds into shares can be successfully realized,and what are the motivations and effects of share repurchase?,more in-depth research is needed.Therefore,this thesis selects the case of Zhongtian Technology’s share repurchase for convertible bond swap as the analysis object,because Zhongtian Technology has used all the repurchased shares for the convertible bond it issued.A complete cycle analysis of the motivation and various effects of Zhongtian Technology’s share repurchase,and discusses the specific effects and causes of the "share repurchase +convertible bonds" model used by Zhongtian Technology,for those who plan to repurchase Listed companies whose shares are used to convert convertible bonds into shares provide certain reference and reference.This thesis first reads a large number of domestic and foreign literature on the motivation and effect of share repurchase and the issuance motivation and terms of convertible bonds through the literature research method,laying a solid foundation for the development of the case study.Through the case study method,research the motivation of Zhongtian Technology to repurchase shares,and on this basis,use the event study method to analyze the market effect of share repurchase on the company,and also analyze the financial effect of share repurchase and the repurchase The other effects of using the shares of the convertible bonds issued by Zhongtian Technology to convert shares can guide the share repurchase behavior of listed companies,so as to promote a better combination of share repurchase and convertible bonds.The framework of this thesis is divided into six parts.After introducing the research background of this thesis,the first part of the introduction introduces the research significance of analyzing the case of Zhongtian Technology’s share repurchase under this background.The following content also includes domestic and foreign literature reviews,research methods and Framework for this article.The second part is the basic overview and theoretical basis.It summarizes the basic concept,method,motivation and related legal changes of share repurchase.It also introduces the concept and issuance motivation of convertible bonds.The theoretical basis related to share repurchases and convertible bonds is described.The third part is the case introduction and motivation analysis of Zhongtian Technology’s repurchase of shares for conversion of convertible bonds.Firstly,the basic situation of Zhongtian Technology was introduced,and then the process of Zhongtian Technology’s share repurchase was sorted out.At the same time,the basic situation of Zhongtian Convertible Bonds was introduced,and the shares obtained by Zhongtian Technology’s repurchase were described in detail.How it is used to convert convertible bonds into shares.Finally,it analyzes the detailed motives of Zhongtian Technology’s share repurchase.The fourth part is mainly to analyze the effect of Zhongtian Technology’s repurchase of shares and subsequent operations of repurchase.Firstly,the impact of share repurchase on its capital structure and equity structure is analyzed,and the financial effect is analyzed from four angles of operating ability,debt repayment ability,profitability,and growth ability,and then the share repurchase of Zhongtian Technology is analyzed.At the same time,it focused on analyzing other effects brought to the company by the repurchase mode of "share repurchase + convertible bonds" of Zhongtian Technology.The fifth part analyzes the root cause of Zhongtian Technology’s successful conversion of repurchased shares into convertible bonds based on the actual situation,that is,the analysis of the cause of Zhongtian Technology’s "share repurchase + convertible bonds" model.The sixth part is the conclusion and enlightenment of the full text.This thesis draws three conclusions after comprehensively summarizing a series of processes and effects of Zhongtian Technology’s share repurchase,issuance of convertible bonds,and the combination of the two: First,the impact of Zhongtian Technology’s share repurchase Second,Zhongtian Technology’s plan to repurchase shares for convertible bonds into shares has been achieved;third,the combination of share repurchase and convertible bonds requires conditions for it to work.Finally,this article puts forward relevant suggestions based on the conclusions of the article and the actual situation,hoping to prepare for the repurchase of shares in my country’s capital market for convertible.