The Study On Problem And Counter Measures Of China Renaissance' Private Equity Business

As an important part of the financial market,private equity investment has only taken decades to develop and grow in China.Its development has been continuously promoted with the development of China's economy and the systematization of the financial market.Unlike traditional financial institutions such as banks and securities companies,private equity investment institutions can fully reflect the hierarchy of financial markets,and also participate in shaping the governance structure of target companies.Since the establishment of the GEM market in 2009,many favorable policies have been promulgated by the relevant departments in China,which contribute to the vigorous development of private equity investment.Overseas well-known investment companies have set up branches in China,and a number of local private equity investment institutions have emerged in China.Since 2014,China has strengthened its support for entrepreneurship and put forward the slogan of "mass entrepreneurship and innovation".Under the call of national policy,a large number of innovative entrepreneurship projects have emerged at the level of universities and enterprises,and many innovative industries have emerged in the process of collision.New industries stimulate new demand,which requires incremental capital injection into these industries.In the context of the new economy,diversified financing needs require more in-depth participation of private equity investment.Sharp financial practitioners seize this opportunity to provide financial support for promising start-ups,which also have the opportunity to develop as an important support for China's economic development.It can be seen that the development of private equity investment in China has greatly accelerated the integration and rational allocation of resources,which is conducive to the upgrading and optimization of China's industry,and plays an irreplaceable role in the economic development of the physical and financial market areas.From the point of view of the institution itself,PE has also realized the preservation and appreciation of its own wealth through investment and return collection.However,in the process of development,high returns are bound to be accompanied by high risks.Private equity investment business involves a large amount of money,long investment recovery cycle,coupled with imperfect management of private equity business in China,there is extensive format,so we need to pay close attention to the problems in the process of private equity investment business.Huaxing Capital,as a star company in the industry,has a certain representativeness in its development process and business characteristics.In view of the case of Huaxing Capital,this paper carries out theoretical and practical research,expecting to have further discoveries.On this basis,this paper combs the current situation of Huaxing Capital's business by combining theory with practice,analyses the problems existing in Huaxing Capital's business,and analyses the causes of these problems.Finally,according to the results of the analysis,it gives the corresponding countermeasures and suggestions to promote the development of Huaxing Capital Private Equity Business.Firstly,this paper summarizes the concept,operation mode,development history and current situation of private equity investment by using the method of literature induction.At the same time,then it summarizes the characteristics of the industry background of private equity investment at home and abroad.The current situation of relevant research is summarized and commented to pave the way for the theory of this paper.Subsequently,theoretical research method is adopted to briefly introduce the theoretical basis of the development of private equity investment business,including financial intermediation theory,risk management theory and portfolio theory.This paper summarizes the characteristics of the current industry background of private equity investment in China through combing the development history of private equity investment industry in China and the current industry development background of private equity investment industry in China;takes Huaxing Capital,a private equity investment company,as the research object,to analyze the current situation of its private equity investment business,focusing on the overall development and characteristics of the business,as well as the specific business model,and then finds and summarizes the main problems of Huaxing Capital Private Equity business,including the problems at the strategic level and the problems at the business process level.Among them,the problems of business process level are elaborated from three aspects: investment link,post-investment management link and exit link.Subsequently,according to the problems found above,the paper puts forward some countermeasures and suggestions pertinently.The results of the study provide some suggestions for the development of Huaxing Capital's business,and also have some reference significance for the development of private equity investment business in China.Combining the research results of specific cases with the macro-background of China,we can also get more far-reaching thinking results.