Investment due diligence consulting is a professional service designed to help investors have a comprehensive and in-depth understanding of the business model, market environment, competitive advantage, risk challenges and other aspects of the target enterprise before making acquisitions, mergers and acquisitions, listing and other transactions, so as to make more rational and scientific investment decisions. Shangpu Consulting Group (S & P Consulting) is a well-known independent third-party research and investment and financing consulting organization in China, dedicated to providing professional solutions for corporate strategic decision-making. This paper makes a comprehensive analysis and outlook on the investment due diligence consulting business of Shangpu Consulting Group from the aspects of the development history of Shangpu Consulting Group, the core value of investment due diligence consulting, the current situation and trend of the industry, and the challenges and opportunities it faces, in order to provide valuable reference and enlightenment for investors and enterprises.

Development of 1. Shangpu Consulting Group

Established in early 2008, Shangpu Consulting Group is one of the earliest professional institutions in China to provide IPO, refinancing and M & A consulting services. It has provided professional services to more than 1000 outstanding companies, and has always been accepted by the China Securities Regulatory Commission and the exchange. One of the IPO and refinancing feasibility study consulting institutions with the largest number of declared projects is one of the first professional IPO consulting institutions in the country to obtain Grade A qualifications for the preparation of fundraising feasibility study reports.

The main business segments of Shangpu Consulting Group include: (1) [Industry Market Research]: providing industry research reports, market research, competitive enterprise research, product channel research, market entry research, consumer research, overseas market research, etc.; (II) [Investment Consulting]]: provide project feasibility study report, PPP project consultation, project application report, project initiation report, project proposal, energy conservation assessment, social stability risk assessment report, safety pre-evaluation, capital application report, business plan, industrial planning, park planning, etc.; (III) [Listing M & A Refinancing Consultation]]: provide IPO listing and refinancing investment feasibility study report, listing market segmentation research, listing industry research consultant, IPO pre-listing counseling and consulting.

Shangpu Consulting Group is headquartered in Beijing and has established branches or offices in Shanghai, Guangdong, Jiangsu, Shandong, Hebei, Tianjin, Shaanxi, Chongqing, Zhejiang, Hubei and other regions. The consulting service network can cover the whole country. As a foreign-related investigation and licensing unit of the the People's Republic of China National Bureau of Statistics, Shangpu Consulting Group not only serves Chinese domestic enterprises, but also helps foreign enterprises achieve greater success in the Chinese market.

2. the core value of investment due diligence consulting

The core value of investment due diligence consulting is to solve the information asymmetry between the two sides of the investment and help investors to further determine the value and risk of the enterprise. The content of investment due diligence consultation involves the business, finance, law and other aspects of the enterprise, which requires professional knowledge and experience, as well as rigorous logic and analysis. The process of investment due diligence advice typically includes the following steps:

The first step: clear due diligence requirements. After the investor and the target enterprise have reached a preliminary intention, they sign a letter of intent to invest, clearly taking due diligence as a prerequisite for further signing a formal investment agreement, as well as the scope, time and manner of due diligence.

Step 2: Prepare due diligence information. Investors will submit a list of due diligence information to the target enterprise, requiring the target enterprise to provide relevant internal information within the agreed time, such as articles of association, list of shareholders, financial statements, contractual agreements, litigation and arbitration, etc. Investors also collect external information about the target company through other channels, such as industry reports, market data, and competitors.

Step 3: Carry out due diligence work. Investors will set up a due diligence team to conduct a comprehensive and in-depth investigation and analysis of the target enterprise according to the due diligence data and external information, and focus on the business model, market environment, competitive advantages, risk challenges and other aspects of the target enterprise by means of on-site visits, data review, personnel interviews, etc., to discover and verify the value and risk points of the investment.

The fourth step: the formation of due diligence results. Based on the results of due diligence, investors will form a due diligence report to make a comprehensive assessment and recommendations on the value and risk of the target enterprise to provide a basis for investment decisions. If the due diligence results support the investment, the investor will enter into a formal negotiation and contracting process; if the due diligence results do not support the investment, the investor will terminate the investment or renegotiate the terms.

The core value of investment due diligence consulting is reflected in the following aspects:

One is to improve investment efficiency. Investment due diligence consultation can help investors quickly and accurately understand the real situation of the target enterprise, avoid blind investment or missed opportunities, save investment time and cost, and improve investment efficiency.

The second is to reduce investment risk. Investment due diligence consulting can help investors identify and assess the potential risks of the target enterprise, such as market risk, financial risk, legal risk, etc., and formulate corresponding risk prevention and response measures to reduce investment risk.

The third is to optimize the investment structure. Investment due diligence consulting can help investors determine the reasonable valuation of the target enterprise, as well as the mode and proportion of investment, such as equity investment, debt investment, mixed investment, etc., optimize the investment structure and maximize the investment income.

Four is to promote investment cooperation. Investment due diligence consulting can help investors establish trust and communication with target enterprises, enhance the willingness and ability of both investors to cooperate, and provide a good foundation for subsequent investment management and operation.

Industry status and trends of 3. investment due diligence consulting

The industry status and trends of investment due diligence consulting can be analyzed from the following aspects:

First, the market demand is strong. With the rapid development of China's economy, the investment activities of enterprises are increasingly frequent and complex, involving many industries and fields, and professional investment due diligence consulting services are needed to assist investment decisions.

Second, the service content is diversified. The service content of investment due diligence consulting not only covers the traditional financial, legal, tax and other aspects, but also extends to business, strategy, technology, environment, society, human resources and other aspects, so as to meet the investors' all-round understanding of the target enterprise. At the same time, the service objects of investment due diligence consulting are not limited to enterprises, but also include governments, social organizations, individuals, etc., involving a variety of investment forms, such as mergers and acquisitions, equity, bonds, funds, projects, etc.

The third is the innovation of service mode. The service model of investment due diligence consulting is also constantly innovating and changing to adapt to the changes and needs of the investment market. On the one hand, investment due diligence consulting agencies use the Internet, big data, artificial intelligence and other technical means to improve the efficiency and quality of due diligence, reduce the cost and risk of due diligence, and provide more intelligent and digital due diligence services. On the other hand, investment due diligence consulting agencies form partnerships with investors, target companies, intermediaries, etc., to provide more customized and integrated due diligence services to maximize the value of due diligence.

Challenges and opportunities of 4. investment due diligence consulting

The challenges and opportunities of investment due diligence consulting can be analyzed from the following aspects:

One is the challenge: the industry is highly competitive. The growth of market demand for investment due diligence consulting has attracted more and more consulting agencies to enter the field, forming a fierce competition pattern. According to data from the China Consulting Industry Association, as of the end of 2019, the number of China's investment due diligence consulting agencies has exceeded 5000, including the internationally renowned Big Four accounting firms, McKinsey, Bain, Boston and other strategic consulting companies, as well as domestic Professional consulting companies such as Shangpu Consulting Group, Huasheng Consulting, and China Intelligence Consulting. These consulting agencies not only compete in terms of price, quality, speed, etc., but also differentiate and innovate in terms of service content, model, and scope, making the industry competition for investment due diligence consulting increasingly fierce.

The second is the challenge: customer needs change. The customer needs of investment due diligence consulting are also constantly changing and improving, which puts forward higher requirements for the service level and ability of investment due diligence consulting. On the one hand, investors' due diligence requirements for the target enterprise are more comprehensive and in-depth, paying attention not only to the history and current situation of the enterprise, but also to the future and potential of the enterprise, not only to the internal situation of the enterprise, but also to the external environment of the enterprise, not only to the financial and legal aspects of the enterprise, but also to the business and strategy of the enterprise. On the other hand, investors pay more attention to and evaluate the service effect of investment due diligence consulting. They not only require investment due diligence consulting to provide accurate and reliable information and analysis, but also require investment due diligence consulting to provide valuable and influential suggestions and solutions. They not only require investment due diligence consulting to support investment decisions, but also require investment due diligence consulting to promote investment cooperation.

Three is the opportunity: the industry development space is broad. Investment due diligence consulting industry development space is still very broad, with huge market potential and growth opportunities. On the one hand, with the transformation and upgrading of China's economy, the investment activities of enterprises will be more frequent and diversified, involving more industries and fields, and more professional investment due diligence consulting services are needed to assist investment decisions. Especially in emerging fields, such as the Internet, artificial intelligence, biotechnology, new energy, etc., the demand for investment due diligence consulting will be more vigorous and urgent. On the other hand, with the globalization and internationalization of China's economy, the investment activities of enterprises will be more cross-border and cross-cultural, involving more countries and regions, and more international investment due diligence consulting services are needed to assist investment decisions. Especially under the promotion of the "Belt and Road" initiative, the demand for Chinese companies' overseas investment due diligence consulting will be stronger and more urgent.

5. the advantages and strategies of the investment due diligence consulting business of Shangpu Consulting Group.

The investment due diligence consulting business of Shangpu Consulting Group has obvious advantages and characteristics in the industry, which are mainly reflected in the following aspects:

One is a professional team. Shangpu Consulting Group has a professional team composed of senior industry experts, senior investment consultants, senior financial accountants, senior legal consultants, etc., with rich industry knowledge, investment experience, due diligence skills and methods, and can Provide customers with high-quality investment due diligence consulting services.

The second is full service. Shangpu Consulting Group can provide customers with comprehensive investment due diligence consulting services, covering business, finance, law, taxation, technology, environment, society, human resources and other aspects. It can conduct in-depth analysis and evaluation of target enterprises from multiple angles and dimensions, and provide customers with all-round information and suggestions.

Three is a custom program. Shangpu Consulting Group can provide customers with customized investment due diligence consulting solutions according to their different needs and characteristics, and can formulate appropriate due diligence scope, due diligence methods, due diligence reports, etc. for different industries, fields, investment forms, investment purposes, etc., to provide customers with personalized services.

Four is the innovation model. Shangpu Consulting Group can use the Internet, big data, artificial intelligence and other technical means to provide customers with innovative investment due diligence consulting models, and can improve the efficiency and quality of due diligence through online platforms, data analysis, and intelligent recommend. Reduce the cost and risk of due diligence, and provide customers with intelligent and digital services.

The development strategy of Shangpu Consulting Group's investment due diligence consulting business mainly includes the following aspects:

One is to strengthen team building. Shangpu Consulting Group will continue to strengthen the construction and training of the investment due diligence consulting team, continuously improve the team's professional level and service capabilities, attract and retain outstanding talents, and build an efficient investment due diligence consulting team.

The second is to expand the service content. Shangpu Consulting Group will continue to expand the service content of investment due diligence consulting, continue to explore and develop new due diligence areas and due diligence projects, meet the diversified and personalized needs of customers, and provide more diversified and comprehensive services.

Third, innovative service models. Shangpu Consulting Group will continue to innovate the service model of investment due diligence consulting, constantly introduce and apply new technical means and tools, improve the efficiency and quality of due diligence, reduce the cost and risk of due diligence, and provide more intelligent and digital services.

Four is to expand the scope of services. Shangpu Consulting Group will continue to expand the scope of investment due diligence consulting services, and continue to explore and enter new industries and fields, especially emerging fields, such as the Internet, artificial intelligence, biotechnology, new energy, etc., to provide customers with more cutting-edge and Professional services.

Conclusion

Investment due diligence consulting is a professional service designed to help investors have a comprehensive and in-depth understanding of the business model, market environment, competitive advantage, risk challenges and other aspects of the target enterprise before making acquisitions, mergers and acquisitions, listing and other transactions, so as to make more rational and scientific investment decisions. Shangpu Consulting Group is a well-known independent third-party research and investment and financing consulting organization in China, dedicated to providing professional solutions for corporate strategic decision-making. The investment due diligence consulting business of Shangpu Consulting Group has obvious advantages and characteristics in the industry, which are mainly reflected in professional teams, comprehensive services, customized solutions, and innovative models. The development strategy of Shangpu Consulting Group's investment due diligence consulting business mainly includes strengthening team building, expanding service content, innovating service models, and expanding service scope. This paper makes a comprehensive analysis and outlook on the investment due diligence consulting business of Shangpu Consulting Group from the aspects of the development history of Shangpu Consulting Group, the core value of investment due diligence consulting, the current situation and trend of the industry, and the challenges and opportunities it faces, in order to provide valuable reference and enlightenment for investors and enterprises.