The Impact of Regulatory Inquiries on the Content Quality of Corporate IPO Disclosure - A Case Study of HyperStrong

The registration system is a fundamental system for China's capital market, which has been widely recognized by academics and regulators, followed by a positive response from the SSE STAR Market. Based on the backdrop of the registration system, this paper takes the company prospectus and inquiry letter as the research object. It selects the case study of Beijing HyperStrong Technology Co., Ltd., which has gone through two rounds of inquiry and has been successfully listed. First, this paper describes the research background and significance of the regulatory inquiries under the SSE STAR Market registration system. It analyzes the current status of research at home and abroad. Secondly, it introduces the basic situation of the case companies. Then, the percentage of various questions and concerns of the SSE's two rounds of questioning of the case companies are analyzed respectively. Finally, the impact of SSE's regulatory inquiries on the disclosure quality of the case companies is analyzed in terms of adequacy, consistency, and comprehensibility. The study shows that regulatory inquiries have significantly improved adequacy, consistency, and comprehensibility in the prospectuses of proposed listed companies, effectively optimizing the quality of initial prospectuses. As a result, proposed listed companies should respond to trading inquiries promptly, maintain consistency in information disclosure, and comprehensively consider risk factors to enhance trust between companies and investors. Currently, there are fewer case studies of regulatory inquiries under China's registration system, and this paper provides a case study of regulatory inquiries, which can enable issuers to understand better the concerns and significance of regulatory inquiries by regulators for IPOs.