Research On The Motivation And Performance Of Convertible Bond Financing Of Photovoltaic Enterprises

Driven by the dual policy goals of carbon peaking and carbon neutrality,promoting the development of the photovoltaic industry is of great significance to ensuring the gradual withdrawal of traditional energy and building on the safety and reliability of new energy.Photovoltaic enterprises as a high-risk and high-growth high-tech enterprises cannot be separated from financial support.With the gradual disappearance of government subsidy dividends,photovoltaic companies are increasingly aware of the importance of market-oriented financing.However,at present,China lacks a sound venture capital system,resulting in financing difficulties and high financing costs for photovoltaic enterprises.From the perspective of capital market financing in developed countries,convertible bonds,as a financing tool with both debt and equity characteristics,have lower financing costs and are more often used in high-risk and high-growth industries such as photovoltaic companies.In addition,after the promulgation of the "New Rules on Refinancing" in 2017,China’s convertible bond market has ushered in explosive growth,and convertible bonds have won the favor of more and more enterprises and investors.In this context,this thesis selects the representative LONGi shares of photovoltaic companies as the case study object to explore the applicability of photovoltaic enterprises to use convertible bond financing,so as to provide more reference for photovoltaic companies when choosing financing methods.This thesis first sorts out the relevant literature research on the financing problems of photovoltaic enterprises,the financing motivation and performance of convertible bonds,and then introduces the financing status of photovoltaic enterprises in China.Next,it summarizes the concept,characteristics,relevant financing theory and the development status of China’s convertible bond market.Then,the financing case of LONGi convertible bonds was introduced,and a basic introduction was made to LONGi shares and LONGi convertible bonds.The financial indicator method,event research method and EVA analysis method were used to analyze the performance changes before and after the issuance of convertible bonds by LONGi shares,and the driving force of LONGi shares’ issuance of convertible bond financing was analyzed in combination with national industrial policies,industry development trends and LONGi shares’ own actual situation.Finally,from the two levels of photovoltaic companies and regulators,some suggestions on the financing policies of convertible bonds are put forward.This thesis finds that the main reasons for LONGi to choose convertible bond financing are as follows: first,the company’s technology research and development and project investment and construction require a lot of funds;second,the "new rules on refinancing" highlight the advantages of convertible bond financing;third,to optimize the company’s capital structure through the issuance of convertible bonds;fourth,to obtain low-cost funds;fifth,to avoid rapid dilution of company equity.The successful issuance of LONGi’s bonds has eased the financial pressure of the rapid development of LONGi shares,improved the company’s capital structure,obtained funds with relatively low financing costs,and also alleviated the problem of the rapid dilution of the company’s equity.Convertible bond financing has enhanced the solvency and profitability stability of LONGi shares.At the same time,LONGi’ issuance of convertible bonds has a good announcement effect,which has been favored by investors.After the issuance of convertible bonds,the stock price of LONGi shares has a good trend and achieved a good market response.According to comprehensive case analysis,it is more suitable for photovoltaic companies to choose convertible bond financing,but they should also combine their own operating and financial conditions to choose the timing of issuance in a timely manner.