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On April 12, Huawei issued 3 billion yuan of ultra-short-term financing bonds, which once again attracted the attention of netizens and investors.
Why is Huawei issuing bonds many times, how short of money is it?
Who wants to lend money to Huawei as a creditor?
01
This is Huawei's 2022 second ultra-short bond, with a maturity of 180 days and an amount of 3 billion yuan, underwritten by the Bank of China and the China Development Bank, the payment date and the start interest calculation date are all April 15, listed and circulated on April 18, and a one-time repayment of principal and interest after maturity.
Yes, you remember correctly, just in early March, Huawei issued the first phase of ultra-short-term financing bonds in 2022, with an issuance fund of 3 billion yuan, a total of 18 institutions for subscription, and the amount of compliance subscription was 7.87 billion yuan.
These two times are ultra-short-term, giving people the feeling of short-term lack of money, debt relief, short-term turnover.
However, there are also some longer bond issuances. In fact, Huawei has also issued a total of 3 medium-term notes this year.
In early January, Huawei issued the first medium-term note of 2022, planning to issue 4 billion yuan; then, from January 20 to 21, Huawei issued the second medium-term note of 2022, planning to issue 3 billion yuan with an issue period of five years; and then issued the third medium-term note of 2022 from February 24 to 25, with a planned issuance of 4 billion yuan and a three-year maturity.
These several bond issuances, three to five years of time, it seems that Huawei is not only short-term lack of money.
02
Is there really a shortage of money?
In fact, speaking of which, Huawei is not short of money.
According to Huawei's 2021 annual report, global sales revenue was 636.8 billion yuan, down 28.6% year-on-year, but net profit increased by 75.9% to 113.7 billion yuan. Due to the improvement of the profitability of the main business, Huawei's operating cash flow has improved in 2021, reaching 59.7 billion yuan, an increase of 69.4%.
In response to this phenomenon, Meng Wanzhou said that although Huawei's scale has become smaller, cash flow acquisition capabilities and profitability are growing, and its ability to cope with uncertainty is also improving.
So, there is no shortage of money, why do you continue to issue bonds?
Is it like some other companies, can you borrow money and raise funds, regardless of three seven twenty-one, first borrow and then say?
03
Huawei first issued debt in China in 2019, when China's domestic bond market developed rapidly and ranked second in the world in terms of market capacity. Huawei mainly wants to open up the domestic bond market in China by issuing debt in China, which can enrich financing channels and optimize the overall financing layout.
At that time, Huawei founder Ren Zhengfei responded that he did not know about the bond issuance at first.
Subsequently, Huawei's asset management department explained that there are three purposes: first, to increase the society's understanding and trust in Huawei through bond issuance; second, to issue debt at the best time, not at the most difficult time; third, (at that time) Western bank financing became more difficult, want to try financing in domestic banks.
As can be seen from this, the idea of Huawei financing is very healthy. It is not because of the lack of money to borrow money so simple, but from multiple perspectives, but also consider the future long-term development and image.
04
Judging from the situation of the three medium-term notes this year, the recognition of the institution is very high. This also shows that Huawei is not really short of money, and everyone is very confident.
The first medium-term note, in early January, was subscribed by 19 institutions, with a compliant subscription amount of 10.34 billion yuan and an effective subscription amount of 4.941 billion yuan, far exceeding the planned issuance of 4 billion yuan.
In the second phase, still in January, 14 institutions subscribed for the purchase, and the amount of compliance subscription was 7.3 billion yuan, which was far more than the 3 billion yuan planned at that time.
In February, the third phase, 20 institutions subscribed, and the amount of compliant subscription was 6.620 billion yuan, which also exceeded the planned 3 billion yuan.
Every time a debt is issued, there will be many institutions to subscribe, everyone rushes to be the creditor, and Huawei's potential is still very optimistic.
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