Research on the IPO Listing Risks of Chinese Family-Owned Private Enterprises Based on a Rejection Case

With the continuous improvement of the capital market and the trend of national economic development, China's IPO system has also changed in response to the country's circumstances and financial situation. Thanks to Chinese economic reform, more and more private companies want to IPO listing. In addition, most of these companies are family-owned private enterprises, which are the main group of IPO applicants due to their seniority and size. However, this type of enterprise started early, it still have many old and inadequate systems, as well as irregularities in disclosure and trading. These shortcomings will become the main risk of IPO failure. Shenghuabo Electric Co., Ltd. is a typical family-owned private enterprise, thus it will be used as an example for this paper. In addition, this article mainly analyses the reasons related to the enterprise's IPO being rejected, and gives corresponding solutions. The purpose of it is to provide assistance to family-owned private companies for future IPO listings.