The Application For Financial Risk Analysis And Control In IPO Financing Of Private Military Enterprises

The military industry is a very special industry with many specific feature as it's under very strong control of the government.This industry was labeled with state owned historically.Many corporations and institutes in this industry have their common specific industry culture.Those kinds of culture have very strong social background of this country and its government.With the transformation of China's economic market and the strong rise of China's private economy since reform and opening,private enterprises,whether in economic strength or scientific and technological strength have been involved in the quality of national defense construction.In 2007,the government determined the business scope of private enterprises to enter the national defense science and technology industry and promoted the military enterprises shareholding reform,and today it has entered a period with rapid development.However,there are still resistance and difficulties for the private enterprises to participate in the construction of the national defense industry with a high financial risk.At the same time,with the development of private enterprises,they have a strong capital demand,while private enterprises to apply for bank loans will be restricted by the application condition such as mortgage guarantee and have heavy financial costs.In the difficulties of debt financing,the IPO financing is a good way.However,due to the particularity of the business attributes of the military industry and the private enterprises not paying attention to the financial risk,for the successful IPO financing,the ability of financial risk control is very important.Under this background,the author explores the financial situation of Company A as a private military enterprise,trying to analyze the various risks encountered in the IPO financing of China's private military enterprises through the theory and the case,in order to provide reference for the peers to solve the financial risk.This paper first summarizes the general situation and current situation of private enterprises in China,and then subdivides them into the military industry,and finally introduces the research object,Company A.After analyzing the operation and development strategy and planning of Company A,this paper discusses the financial risk in IPO financing of Company A by the qualitative analysis and quantitative analysis with the financial situation of Company A at the present stage,and analyze the causes of its financial risk,and thus formulate the financial risk control system after IPO financing.At the end of the article,it discusses how to prevent the financial risk of private military enterprises and puts forward corresponding countermeasures and suggestions for the various financial risks that enterprises may encounter in IPO financing.