Research the right time to issue CB and operating performance
| Autor: | Lin, Su-Ching, 林素菁 |
|---|---|
| Rok vydání: | 2003 |
| Druh dokumentu: | 學位論文 ; thesis |
| Popis: | 91 To consider or base on the purpose of financing、the cost of capital、the amount of fund、current financial market conditions and governing laws…..etc, usually a company will choose the most beneficial source of finance. In 1990 in Taiwan, the Convertible Bond（CB）was issued by Far East Textile Co. and was favorably attracted by both companies and investors since. The primary subject of this studding is to discuss the correlation between the time of issuing CB and operating performance after issuing CB. Hopefully, this paper can be useful to the company desiring to issue CB in the future. First o fall, by using the survey method I found that most companies in Taiwan chose issuing local CB as the source of finance because of cheaper capital cost. Some companies chose issuing ECB for reducing interest burden. Secondly, by using practical test method; separate the selected samples into four groups for comparison testing. In results, there is no obvious correlation between exterior factors and the companies whether issuing CB. The exterior factors include interest、stock price and security laws. Finally, this paper explains the operating performance, especially the earning profit ability, of the companies getting poor after issuing CB. To understand such result, compare the characteristics of the companies in the same industry. In steel and iron industry; the financial ratios of the selected company without issuing CB are poorer than competitors’. Then the selected company didn’t get better within two years after issuing CB. In this case, I can’t assume that the operating performance or result is related to the company issuing CB matter. In electronic industry; three samples of electronic corporations were compared with their competitors. This paper illustrates that issuing CB as the way of financing for the company is the most popular among semiconductor industry. Although the selected company faced a downturn in earnings after issuing CB, it still performed well in terms of financial ratios compared with its competitors. To go a step further to observe the issuing time during 1997 and 1998, the semiconductor industry encountered a slumped condition until early 2000. In this time frame, CB product naturally explained its merits by itself. When the company faced a down-turn economic situation, usually with poor earnings, the company tended to issue CB as the source of finance in order to reducing interest cost, smoothing earning per share, protecting shareholders’ rights to transfer a better share price in the future. The condition above accidentally misled the thoughts of that the issue of CB will cause poor earnings. The companies in semiconductor industry chose the right time to issue CB. They still keep a better operating performance than competitors and obtain fund for the lowest cost of capital due to choose issuing CB as the way of finance. |
| Databáze: | Networked Digital Library of Theses & Dissertations |
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