Research On The Effect And Its Influencing Factors Of China's Listed Companies' Convertible Bond Redemption

The redemption clause of the convertible bond is in favor of protecting the interests of the issuer in theory,but the actual effect of the redemption of the convertible bonds needs to be further observed and studied.Firstly,this paper,based on the domestic and foreign literature,uses theoretical approaches to analyze the overall situation and distribution characteristics of China's listed companies' convertible bond redemption and its development,the implementation of the design characteristics of the main system and the terms of the redemption of convertible bond redemption.Secondly,events research based on CAR is applied to verify the short-term and long-term effects of Chinese listed companies' convertible bond redemption on their share price.Thirdly,the influence factors of listed companies' convertible bond redemption on the share price are studied through difference-in-differences model and multiple regression model.This research further enriched the domestic related research topic and guide the correct response to the redemption of convertible bonds of listed companies,and promote long-term development of listed companies.Based on this research,the main conclusions are as follows: CAR test results show that the probability of redemption of convertible bonds have a significant impact on the issue of CAR is 84.15%,can have a significant effect on the probability of redemption of convertible bonds of CAR is greater than the general probability;visible redemption of convertible bonds transfer to the market information for short information.Meanwhile,since the time lag in the redemption events' influence to the capital market,the long-term effects on the share price is stronger than the short-term.The empirical results shows that the application of financial leverage can excert positive influence on enterprise value under such circumstance,and redemption of convertible bonds could increase the underlying stock price.The higher growth tendency in enterprises means higher risk exposure.Under such circumstance,redemption of convertible bonds could decrease the underlying stock price.The increasing in corporate profitability can enhance the investor confidence.Under such circumstance,redemption of convertible bonds could increase the underlying stock price.The sufficiency of cash flow can decrease the continuing operations risk.Under such circumstance,redemption of convertible bonds could increase the underlying stock price.As the influence factors of listed companies' convertible bond redemption on the share price,the long-term stock price effect of the factors related to issuers(financial leverage,equity structure,issuers' growth,cash flow utilization ability and profitability)is greater than the short-term stock price effect,the short-term effect of the factors related to the characteristics of convertible bonds(price pressure,the length of the redemption prompt period,and the false redemption probability)is greater than the long-term effect.Through the research of this paper,it is helpful to further enrich the research of domestic related topics;Help guide the listed company to deal with the redemption of convertible debt correctly;It is of great significance in the selection of redemption timing and information disclosure,the setting of reasonable redemption term and dynamic redemption price mechanism,etc..