Case Study On The Default Of Tunghsu Optoelectronic Technology Co.,Ltd.'s Bonds

As an important part of China capital market,the bond market is one of the main places for Chinese enterprises to finance.However,in recent years,Chinese GDP growth has slowed down,the economic downward pressure is great,the market supervision policy has become stricter,and the problem of Chinese enterprises' bond default has gradually emerged.Since "11 Chaori Bonds",the first bond default case in China,occurred in March 2014,there have been frequent defaults in China bond market.The number and amount of bond defaults are increasing,and the default subjects and varieties are increasing,which shows that China bond market is stepping into a mature stage,and at the same time indicates that China bond market still has some shortcomings.Among the numerous corporate bond default cases,Tunghsu Optoelectronic bond default event is one of the most typical cases.Tunghsu Optoelectronic is the largest manufacturer of photoelectric display materials in China and the fourth largest in the world.Before the bond default,the monetary capital of the company's book had reached 13.9 billion yuan,but it could not meet the payment on schedule.On November 19,2019,Tunghsu Optoelectronic failed to pay the first term medium-term notes of 2016 with a total of 2.01 billion yuan as scheduled;On December 2nd of the same year,Tunghsu Optoelectronic defaulted on the second-phase medium-term notes of 2016 worth 1.585 billion yuan.On May 19,2020,"15 Tunghsu Bond" also defaulted.This series of default events have attracted the attention of the government,the majority of investors and private enterprises.On this basis,this paper analyzes the internal and external reasons and economic consequences of the bond default of Tunghsu Optoelectronic by case analysis and model construction.In this paper,it is considered that the external reasons for the bond default of Tunghsu Optoelectronic are the macro economic downturn,the low industry prosperity,the weak binding force of the information disclosure system and the false high credit rating of the company.Radical corporate strategic planning,serious encroachment of major shareholders' interests and poor financial status are the internal reasons for corporate bond default.The bond default led to Tunghsu Optoelectronic management instability,enterprise refinancing difficulties,the company's production and operation conditions deteriorated economic consequences.This paper from the bond issuing companies,related institutions,investors three points of view to get the corresponding enlightenment.From the perspective of bond issuing companies,bond issuing companies should focus on the core competitiveness of the main business,establish the equity balance mechanism and improve the internal control of the company;From the perspective of relevant agencies,regulators should strengthen the restraint of information disclosure system and improve the laws and regulations related to credit rating.Rating agencies should enhance their sense of responsibility,improve the rating tracking system and strengthen the use of quantitative rating analysis methods.From the perspective of investors,relevant investors should establish risk awareness,improve their financial literacy,and pay close attention to market trends.