Motivation And Financial Performance Evaluation Of Convertible Bond Issuance By Teyi Pharmaceutical Group

Convertible bonds as a mixed bond with both bond and equity nature,have been increasingly sought after by enterprises and investors in need of financing under the general performance of China’s stock market in recent years.The government is also constantly improving the relevant laws and regulations on convertible bond financing.As far as China’s current situation is concerned,most of the medium-sized enterprises are facing the problem of financing difficulties in the process of development.Financing may help the enterprises grow rapidly,and the lack of financing may lead to the breakdown of the financial chain of enterprises.With the continuous improvement of the convertible bond market,we can better promote the development of China’s capital market,which provides a new choice for both financiers and investors.But after all,convertible bonds have developed relatively late in the Chinese market,and there will inevitably be some problems in the process of running in with the actual situation of the Chinese market.TEYI Pharmaceutical Group selected in this paper belongs to a chemical pharmaceutical enterprise with medium assets scale and profit status.It is a typical medium-sized enterprise and has a certain representativeness in the pharmaceutical industry.This paper mainly studies the financial performance of TEYI Group’s convertible bond issuance from three aspects:(1)reviewing the motivation,process and terms of TEYI convertible bond issuance,and predicting the financing cost;(2)analyzing the financial performance of the company after TEYI convertible bond issuance through financial indicators,EVA analysis,equity structure and event study method;(3)finding out the problems of TEYI convertible bond issuance and giving suggestions.Finally,the conclusion is drawn that the issuance of TEYI convertible bonds has a positive impact on the company’s financial performance as a whole,but there are still some problems.When choosing convertible bonds as a financing tool,enterprises should rationally design the convertible price,terms of convertible bonds,issuance scale and so on in accordance with their own conditions.Financing does not mean that enterprises will improve their financial performance.Enterprises should also establish effective management mechanism and improve their management level according to their own characteristics.