Research On The Path And Risks Of Domestic Listing Of Red-chip Enterprises

With the tightening of foreign regulatory policies and the improvement of the domestic capital market,more and more red-chip enterprises are seeking to be listed in China.Before2018,red-chip enterprises that wanted to return to A-shares mostly chose to privatize and delist first,and then Dismantle the agreement control structure,transfer control back to China and list on A-shares through direct issue of shares,spin-off listing or backdoor listing.Until March2018,the General Office of the State Council forwarded the "Several Opinions of the China Securities Regulatory Commission on Launching the Pilot Program of Domestic Issuance of Stocks or Depositary Receipts by Innovative and Entrepreneurial Enterprises",which supports innovative and entrepreneurial red-chip enterprises that choose to directly issue stocks or issue Chinese depositary receipts.The method returns to domestic listing,which provides an institutional path for red-chip companies that want to be listed in China.In this context,Ninebot Limited has become the first red-chip enterprise in China that successfully listed CDR on the Science and Technology Innovation Board.Therefore,it is of great theoretical and practical significance to study the path and risks of Ninebot Limited listing CDR in China.Based on the theory of transaction cost theory,undervaluation theory,principal-agent theory and enterprise life cycle theory,this paper uses the method of single case study,qualitative and quantitative analysis and other methods to study the case of Ninebot Limited issuing Chinese depository receipts to go public.According to the analysis,different from the listing of stock,the listing of CDR issued by Ninebot Limited involves both domestic and overseas markets,depositary institutions and custodian institutions,etc.At the same time,there are two main factors influencing the listing of CDR issued by Ninebot Limited.External factors include the launch of the Science and Technology Innovation Board and the introduction of CDR issuance policy,and internal factors include its own financing needs,the retention of the VIE structure and the realization of the global development strategy.Next,this paper analyzes the market effect and financial effect of Ninebot Limited issued CDR listing.To some extent,Ninebot Limited issued CDR listing improves its profitability and debt paying ability,and investors in the capital market also hold a positive attitude towards this.In addition,this paper also further studies the risks and challenges of this listing,including regulatory audit risks,CDR market price volatility risk and the risk of investors’ rights and interests is damaged,the VIE structure of legal,tax,moral risks and the challenge of the cross-border supervision.The research conclusions of this paper not only enrich the relevant literature in the fields of red-chip enterprises’ return to domestic listing motivation,red-chip enterprises’ domestic listing path and Chinese depositary receipts,but also provide some reference for other red-chip enterprises’ return to domestic listing,regulatory authorities’ formulation of relevant policies and investors’ protection of their own rights and interests.