| Abstract | This research has been conducted on the analysis of issuing corporate bonds in Thailand.
The analysis is derived from three case studies of the practical issues of corporate bonds.
These three cases describe three kinds of corporate bonds. They are debentures with
warrants, floating rate debentures, and convertible debentures. This study of issuing
corporate bonds is aimed to enlarge the base of players in corporate bond market, increase
the understanding of issues on how the companies issue bonds in Thailand, choice of
instruments to be used for fund raising, and a price setting mechanism in Thailand.
Three case studies are considered in the same framework. In each case, the study starts
with the background of company and details of the issue. The scope of study covers the
objectives and alternatives of fund raising, issuer's perspective, issuing process, roles of
parties involved, pricing analysis and mechanism, taxation issue, and the result of
launching of each issue.
Next, the analysis is done through the framework of the issue analysis. It consists of the
analysis of instruments, issuing process, and price setting mechanism in Thailand. In
conclusion, the issuer will decide the choice of instruments from two main factors which
are external factors and internal factors. The external factors are market conditions for
issuing bonds, such as current interest rate and trend and stock performance that affects
the yield of debentures and choice of warrants and convertible bonds. The internal factors
are internal condition within the company, such as management objectives, shareholders'
attitude, capital structure, regulation, and issuer's perception of capital market.
Secondly, the analysis of issuing process involving two methods which are public
offering and private placement has been described. The main limitations of issuing bonds
are the difficulty of process and time-consuming process which are commented the
guidelines to develop in the future. Finally, the analysis of price setting mechanism is
drawn to study the factors and their constraints that affect the final price of debenture
issues in Thailand.
There are many constraints in the development of the corporate bond issues in Thailand.
Therefore, the recommendations to reduce the constraints could be addressed in terms of
issuers, regulatory authorities, credit ratings, and investors. This analysis and
recommendations can be beneficial and serve as guideline to develop Thai bond issues in
the future. |