Two sources revealed Tuesday that Chinese smartphone makers$XIAOMI Group-W (01810.HK) $In the near future, it is planned to issue 8 billion yuan of private panda bonds, which is also a debt for epidemic prevention and control.(PPN, targeted debt financing vehicle)The initial issue is planned to be 1 billion yuan, which is a three-year fixed rate variety. This is the first time that XIAOMI Group has issued bonds in China.
Sources also revealed that the debt financing instruments are not guaranteed, assessed by China Integrity International, the main credit rating of the issuer is AAA, the rating outlook is stable. Bank of China Ltd. is the lead underwriter and bookkeeping manager, Industrial and Commercial Bank of China is the co-lead underwriter.
The 8 billion yuan targeted debt financing facility proposed by XIAOMI Group will be used to repay interest on domestic project loans, supplement operating funds, and support epidemic prevention and control. Of this amount, 4 billion yuan will be used to repay domestic project loans and interest, and another 4 billion yuan will be used for R & D investment and supplementary working capital of domestic subsidiaries.
According to the relevant report, XIAOMI Group's income and profit level are increasing, but it is highly dependent on mobile phone business and is easily affected by the industry. The high proportion of overseas business has the risk of trade and exchange rate policy fluctuations, and the net cash from operating activities fluctuates greatly.
XIAOMI's new flagship XIAOMI 10 offline press conference this year was temporarily changed to a purely online live press conference due to the epidemic, the reduction in production capacity caused by the contract manufacturer's delay in resuming work has an impact on global sales, and the closure or delay in opening of the national offline retail and cooperative outlets have had a certain impact on the issuer's short-term sales payback.
XIAOMI Group was contacted by Reuters on the news and the company had no immediate comment.
Related explanation
Panda bondIt is RMB-denominated bonds issued by foreign institutions in China. According to international practice, when foreign financial institutions issue bonds in a country, they are generally named after the country's most characteristic mascot. Accordingly, Minister of Finance Jin Renqing named the RMB bonds issued by international multilateral financial institutions in China as "panda bonds", which, together with Japanese "samurai bonds" and American "Yankee bonds", belong to a kind of foreign bonds.
Samurai bondAlso known as "Japanese yen foreign debt", is a kind of foreign bonds, which are medium-and long-term bonds denominated in yen issued by foreign issuers in Japan. Its issuers are mainly governments and enterprises of other countries outside Japan and international institutions such as the World Bank and the Asian Development Bank, and its investors are basically various institutions and individual residents of Japan.
Yankee bondIt is a foreign bond issued in the US bond market, that is, a bond issued in the US domestic market by governments, financial institutions, industrial and commercial enterprises and international organizations outside the United States and denominated in US dollars. The word "Yankee" means "Yankee" in English, meaning the United States of America.
Edit / Grace