Research On Risk Management Of Sinobioway Medicine Private Equity Investment Project

Private Equity(PE) is the outcome of financial and industrial innovation, Its mode of operation broaden the financing channels for enterprises, and promote the value discovery and value appreciation of the invested business, plus it can offers high-yield investment channels, therefore it plays an more and more important role in the financial system. PE industry started late in China. However, the high uncertainty, high dynamic and high complexity of PE investment determines the high risk in its investment process, especially in Chinese market where the policy of PE has not been completed yet. How to identify the risks of PE investment, thereby effectively control and prevent the risk in PE investment process becomes a big concern of PE industry.The paper first combs the related concepts, theoretical principle and related research about domestic and foreign PE, then summarizes the strategies and the risk control in PE investment, including the value of PE investment, the problem of PE investment and the characteristic of PE investment and so on. The paper selects the Sinobioway Medicine project which is an successful PE investment project in recent years to be the example. The paper uses the scientific, comprehensive, objective, multi-aspect, multi-angle research material of this project as the foundation; chooses the six aspects, including environmental risk, management risk, market risk, technical risk, financial risk and moral risk, to identify and research the risk factors; adopts the risk evaluation index to PE investment; evaluates PE investment by making mathematical model with analytic hierarchy process and Fuzzy comprehensive evaluation method; finally systematic analysis and explains how to identify and control the risk of PE investment project.The paper applies the comprehensive analysis to the risk factors of the PE investment in Sinobioway Medicine projects, and proposes the coping strategies, then come to the conclusion: the key factor of a successful PE investment lies in the successful implementation of effective risk control, which refers to the perfect risk control strategy. Although the risk of PE investment exists objectively in multiple aspects, however, we can choose corresponding strategy and method to control and eliminate the risk in each stage of the operation, minimize the risk or keep the risk in the controllable range, therefore present the practical applied value of this article more clearly.