Group 1 - The convertible bond market is experiencing a "new bond frenzy" due to the scarcity of new issues, highlighted by the strong performance of Hengshuai Convertible Bond, which surged 57.30% on its first day and a total of 88.76% in two days [1][2] - Hengshuai Convertible Bond's strong debut reflects the increasing scarcity of convertible bonds in the market, leading to intense competition for new issues among investors [1][2] - The underlying stock, Hengshuai Co., primarily engages in the research, production, and sales of automotive micro motors and related products, showing steady revenue growth from 331 million yuan in 2019 to an expected 962 million yuan in 2024 [3] Group 2 - The issuance scale of Hengshuai Convertible Bond is relatively small, with a total fundraising of 327 million yuan, which has contributed to its popularity among investors [4] - The convertible bond market is seeing an increase in supply with several new issues launched in June, but the overall market size is still declining due to the accelerated exit of bank convertible bonds [6][7] - The supply of bank convertible bonds has significantly decreased, from nearly 300 billion yuan at its peak in 2023 to about 150 billion yuan currently, leading to a shift in market structure and a search for alternative investments by institutional investors [6][7]

Core Viewpoint - The convertible bond market is experiencing a "new bond frenzy" due to a continued decline in supply, leading to intense competition for newly issued bonds [1][3]. Group 1: Performance of Convertible Bonds - Hengshuai Convertible Bond surged 57.30% on its first trading day and an additional 20% the following day, totaling an 88.76% increase in just two days, marking it as the strongest debut of the year [2][5]. - The bond's performance exceeded market expectations, with an initial conversion premium of approximately 25%, suggesting a listing price range of 117.07 to 130.43 yuan per share [6][10]. - The bond's conversion premium reached 104.98%, indicating a significant market interest despite the underlying stock's stable price [10]. Group 2: Market Dynamics - The scarcity of new bonds is driving a heated competition among investors, reflecting a growing demand for convertible bonds amid limited supply [3][9]. - Since 2019, the company has shown steady revenue growth, with total revenues projected to rise from 331 million yuan in 2019 to 962 million yuan in 2024 [7]. - The convertible bond issuance was relatively small, with a total fundraising scale of 327 million yuan, and a credit rating of A+ [11]. Group 3: Supply and Demand Trends - The convertible bond supply has increased slightly in June, with several new bonds being issued, but the overall market remains constrained due to a significant reduction in bank convertible bonds [15][16]. - The balance of bank convertible bonds has decreased from nearly 300 billion yuan in 2023 to about 150 billion yuan currently, with market share dropping from 38.97% to approximately 22.64% [15][16]. - The ongoing reduction in bank convertible bond supply is reshaping market dynamics and prompting institutional investors to seek alternative assets [16][17].