The release of this information stirred waves among the major trading institutions. A senior bond market practitioner told reporters that after reading the bond issuance brochure, the company basically did not understand the technical aspects, but the financial situation is good. Such private enterprises can be said to be one in a million.Huawei It itself represents a kind of strength.
According to the prospectus, Huawei issued four U.S. dollar bonds overseas in 2015, 2016 and 2017, totaling $4.5 billion, which were not due; there were two single dim sum bonds, totaling RMB 2.6 billion, which had been paid off. Huawei has not had any experience of issuing bonds in China before, so the issuance of the winning ticket will be its first show in the domestic bond market.
The prospectus also indicates that the purpose of the two instalments is to supplement the working capital of the company's headquarters and subsidiaries, mainly due to the fact that "the company's various businesses are expected to maintain a steady growth trend in the future and the financial support will be further increased ". In addition, ICBC and CCB are the lead underwriters of the two installments, and the maturity of the bonds is three years.
It is worth noting that Huawei's unknown financial situation has also been unveiled in the announcement of the winning ticket.
According to financial data, Huawei achieved revenue of 518.068 billion yuan, 598.48 billion yuan, 715.192 billion yuan and 396.538 billion yuan from 2016 to 2018 and the first half of 2019, up 31.58 percent, 15.52 percent, 19.50 percent and 22.86 percent, respectively, and the average annual compound growth rate from 2016 to 2018 reached 17.49 percent.
In addition, among the current assets, monetary funds reached 249.731 billion yuan at the end of June 2019, an increase of 65.644 billion yuan, or 35.66 percent, compared with the end of 2018. In terms of book funds alone, Huawei is not short of money. With regard to the growth of monetary funds, Huawei said, "mainly because the company is based on liquidity management needs, the monetary funds held as the size of the business increases to ensure business demand."
As for the subscription of the winning ticket, the bond veteran said, "it is estimated that the bank will take the big head, most of the non-silver is to watch a lively, after all, when making a buyback, it is not necessarily possible to bet on it."
Joint Credit Assessment Co., Ltd. gives AAA ratings to both the main body of the bond and the debt. Joint Credit said that in recent years, Huawei's core operators have been operating steadily, consumers and businesses have expanded rapidly, and have strong overall profitability, cash acquisition and Reinvestment capabilities; assets and equity scale has continued to grow, cash assets are abundant, and debt burden is relatively light.
Joint Credit also mentioned some of the operational risks the company may face.
But on the whole, "the risk of debt service of the main body of the company is very low, the repayment ability of the current medium-term note is very strong, and the risk of default is very low." That's what the joint credit rating says.
Chief Editor: Yu Shi