Listed Companies In China Convertible Bond Financing Of Theoretical Thinking And Empirical Analysis

Chinese Convertible Bonds (CBs) were first issued on the early 1990s by some companies in need for fund. But the development of CBs is not a plain sailing. In late April 2001, Chinese Securities Regulatory Commission issued the Implementation Regulation and three related documents, this action has drawn great attention to the CBs market. By 2004, although the IPO come to a cessation, the market still continue the trend of rapid development, the scale of CBs has breakthrough 20 billion, and accounted for properly 46.75% of the total refinancing funds, also CBs has gradually become the dominant method of refinance among allotment issue and some other refinancing methods.As the rapid development of CBs market, the fundamental researches of CBs are going further deeply in domestic. There are lots of researchers who focus their attention on the pricing of CBs. This article concentrates the research direction on the performance of the investment and financing of CBs. The research of this article refers to the enterprise's capital structure and the financial condition, and carries on the analysis from two different angles of enterprise and investor.There are 7 chapters in this article, the first three parts introduces basic concepts and attributes of CBs; the history and development stages of CBs in China and abroad are also covered in these chapters.Chapter 4, analysis of enterprise, in this chapter we contrast the CBs to stock and ordinary bond, and carry on the demonstration analysis which refers to the financing dilution effect, the debt factor (tax shield effect and financial burden), as well as the two synthetic influence, also we get the score of each effect base on EPS and EBIT, thus finally we get the results that the CBs is better than other two financing tools in the same condition.Chapter 5, analysis of investor, in this chapter we analyze all the options which CBs includes, and then we get the formula of the time value which not only can we use to check the validity of Chinese CBs market, but also find the arbitrage space by which we can instruct the investor.Chapter 6, the research of this part is in the background of the Reform of China Stockholder's Right. First we classified CBs into three kinds by their options, by which we get the value change that before and after the Reform, and then finally discover the inherent laws.At last we focus on the problems and weaknesses of CBs, suggestions to handle the problems, overcome the weakness and the development directions are provided in this concluding chapter.