The Case Analysis Of The Catering Enterprises Company A’s Failed IPO

Capital markets set up a broad platform for enterprises to pursue direct financing.Many companies in our country strive to use IPO(initial public offering)to utilize the capital market to broaden their financing channels.The success of a company’s IPO not only can raise the necessary funds for further development,but also it can optimize the company’s capital structure,ownership structure,improve the company’s social reputation,standardize the company’s operations,and realize the expansion of the enterprise.With the development of catering enterprises,more and more catering enterprises attempted to raise money from the capital market.However,as a result of the insufficiency caused by the catering industry’s characteristics and the influences of the policy environment,the prospect for catering enterprises to be listed in China’s stock market currently is not optimistic.This study selects the case of company A’s failed IPO as the research subject,firstly exploring the motivation to reflect the current tendency of catering enterprises to utilize the capital market in our country,then analyzing the reasons leading to the failure of company A’s IPO,and finally providing feasible suggestions to facilitate the IPO processes for catering enterprises and regulation agencies.As the only one catering enterprise which insisted to use IPO for financing in our country in the past few years and finally failed,company A’s failed IPO has the symbolic significance,and the research about the causes of its failure has highly practical value and theoretical significance to help the catering enterprises resolve the difficulties involving in the IPO processes in the future.This study is based on the financing theory from corporate finance and uses the case analysis method to investigate company A’s failed IPO,combining with the current situation of the catering industry development.The thesis started introducing the current situation that catering industry’s concentration in Chinais weakening and catering enterprises are engaging in strengthening their brand.Next,the listing process and results of company A’s IPO is described.From company A’s IPO prospectus during 2014-2015 and its financial statement,this study analyzes the reasons for the failed IPO comprehensively from the external and internal factors.Several policy suggestions are drawn from the case analysis to counter the IPO difficulties of catering enterprises.For suggestions to catering enterprises,this study discussesthe six requirements from the China Securities Regulatory Commission(CSRC)for the catering enterprises to be publicly listed,the 2012 guidance for catering enterprises which pursue IPO to continuously improve their operating standards,and the possibility of listing on the new over-the-counter market first and transferring to China’s A-shares market after meeting the more stringent listing requirements.For suggestions to regulation agencies,this study recommends the regulators to modify the No.10 document to build a better environment for catering enterprises to go IPO.Through the case analysis,this study suggests the potential opportunities for catering enterprises to bepublicly listed in our country are huge.Catering enterprises and regulatory agencies can work together to resolve the difficulties involved in the IPO processes.