Bonds Apr 30

Yankuang Group registers first corporate bonds

Coal mining conglomerate needs funds to help meet costs of an expected upgrade of operations required under new environmental law

Yankuang Group registers first corporate bonds
Yangkuang Group is a large provincial coal enterprise that ranked 318th in the world's top 500 companies in 2019. Photo: Company website.

(ATF) Yankuang Group Co Ltd has registered a proposal to issue its first corporate bonds. The Oriental Fortune News and Dazhong Daily say this is the first corporate bond application in the coal mining and washing industry approved by the National Development and Reform Commission. It will have a total approved scale of 10 billion yuan.

The first tranche of the issue is understood to be 1.5-billion yuan with a 10 year term. At the end of the fifth year, the issuer has the option to adjust the coupon rate and investors have the option to sell back. The coupon rate is 3.48%, which is low.

Yankuang Group is a large provincial coal enterprise that ranked 318th in the world's top 500 companies in 2019, according to the firm. It has assets, capital, coal resource reserves and output strength. It mostly deals in the coal chemical industry, modern logistics trade and engineering technology services. In recent years, operating income and total profit have increased rapidly. It is reported that the debt repayment of Yankuang Group's financing is mainly derived from the company's daily operating income.

In recent years, the National Development and Reform Commission has successively issued a series of policy documents to increase the proportion of direct financing, to optimise bond financing services, promote high-quality economic development, support good credit, sound operation, and lead the transformation and upgrading of industrial structure or regional economic development.

The high-quality corporate bonds declared by Yankuang Group were approved and issued by the National Development and Reform Commission in 2019. They are valid for two years and issued in instalments. 

Today, President Xi announced ‘The Law of the People ’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste’.

This law was revised and adopted by the 17th meeting of the Standing Committee of the 13th National People’s Congress yesterday (April 29). It will take effect tomorrow (May 1).

As a large coal producer, Yankuang Group will need extra funds to meet legal requirements.