Research On The Problems And Countermeasures During The Native Private Enterprises Initial Public Offering In GEM

At present, private enterprises in China showing a good momentum of rapid development. They have become an important component of national economic development. In the past five years, the amount of total investment to native private economy has been growing 30% annually. In the next five years, the development speed of the private enterprises in China will higher than the national average. The total private economy is expected to rise to three quarters of account for GDP. But it is in sharp contrast to that, the proportion of private enterprises in listed companies is still very low. Many high-quality private enterprises are not yet listed. In recent years, the state has adopted a number of policies to encourage private enterprises to list in foreign markets. Private enterprises listing in overseas markets, especially in GEM for the IPO is gradually forming a craze.But around 2002, severer serious incidents such as the scandal of the "EURO-ASIA AGRIC " occurred in GEM, which shows that there are still many problems during the native private enterprises initial public offering in GEM. If those problems are not resolved or prepared to be resolved before the listing, the process of the private enterprises go to GEM IPO will full of risks. The slight consequence is that it may cost too high; the serious consequence is that it may lead to the failure of the IPO, and even may do harm to the public image and normal operation of the private enterprises. From the second half of 2006, the GEM began to regain prosperity under the impetus of the Main Board and the market in the main land, many native private enterprises will be listed in 2007, which have waited for this for years. Therefore, the study of the problems and countermeasures during the native private enterprises initial public offering in GEM is of universal significance.This paper uses both quantitative and qualitative investigation, on the basis of analyzing the characteristics of the private enterprises and GEM, discusses the problems such as having no clear understanding of the GEM IPO process and difficulties, huge direct cost of listing is hard to be handled, and timing of listing, etc. that may occur during the native private enterprises initial public offering in GEM. After that, this paper makes out some properly countermeasures. This is with a reference to enrich the theories on the financing subject of the native private enterprises and to improve the financing capacity of private enterprises listed in Hong Kong.This paper is organized as seven chapters: Chapter I foreword includes the definition of related conceptions, describe of the subject, the meaning of the research and the innovation points of this paper; Chapter II introduces some recent research on the private enterprises oversea-listing and the GEM, and IPO under-pricing theories; Chapter III studies the characteristics of the private enterprises and GEM market separately; Chapter IV studies the process and difficulties of IPO in the GEM; Chapter V discusses the problem that huge direct cost of listing is hard to be handled; Chapter VI confirms the conclusion that the pricing process of IPO and the UP in the GEM are effected mainly by the performance of the market, and also studies the timing of listing during the native private enterprises initial public offering in GEM; The last Chapter summarizes the findings, conclusions and limits of this paper.