Causes And Enlightenment Of Shanghai Huaxin International Group Bond Default

Since China's economy has entered the new normal,there have been different trends in economic development and various forms of industrial operation.Enterprises seeking to develop gradually expand their scale by issuing bonds in the bond market,which makes China's bond market develop rapidly.However,since 2014,the first default event broke out,credit risk began to gather gradually.Since then,default events in the bond market have emerged one after another,and a large number of scholars and investors have also studied them.2018 was a massive "thunderstorm" in the bond market,and companies with the first main rating of AAA also defaulted one after another,which not only caused panic to the bond market,but also greatly damaged the interests of investors.The bond market in 2019 is still not optimistic,and the number of defaulted bonds has exceeded 2018.Therefore,at this stage,in-depth analysis of the reasons for default of bond defaulting enterprises and the construction of bond risk prevention system can avoid the same mistakes of other enterprises,help investors to identify investment risks,and promote the reasonable clearing of China's bond market.Taking Shanghai Huaxin International Co.,Ltd.,a bond defaulting enterprise whose first principal rating is AAA,as an example,this paper summarizes and collates the relevant theories of domestic and foreign scholars on bond default and default risk prevention research literature,and combined with the current situation and characteristics of default in China's bond market,deeply analyzes the causes of bond default of Shanghai Huaxin Group.Finally,we get the relevant enlightenment to the debt default in the capital market.First of all,it gives an overall description of the current situation of credit debt default of Chinese enterprises.It mainly includes the statistical analysis of the number and amount of bond default and summarizes the common characteristics of some bond default.Secondly,it introduces the default event of Shanghai Huaxin "17 Shanghai Huaxin SCP002" and the serious consequences and deep-seated causes of Shanghai Huaxin bond default.The main purpose of this paper is to analyze the reasons for the company's breach of contract from the aspect of the company's cash flow,the company has aggressively expanded the overseas market,which has worsened its financial statement data,and adopted the strategy of "fixed purchase by sales" in the way of sales.there is a problem that the amount of accounts receivable is huge and the growth rate is fast,and the liquidity pressure is very great.The controlling shareholder of the company was investigated by the relevant departments,which hindered the company's refinancing ability,resulting in a shortage of cash flow and bond default.The last part is the enlightenment of this case to the prevention of enterprise debt risk and the safe operation of capital market in our country.At the micro level,bond issuers should take specific measures to improve solvency and investors' ability to identify risks;at the meso level,the service system of third-party institutions should be strengthened to fulfill their disclosure obligations dutifully;at the macro level,the regulatory system of the bond market should be standardized to promote the safe operation of the market to put forward different policy recommendations,hoping to guard against the risks related to bond default to the maximum extent and ensure the healthy and orderly development of China's bond market.