Shanghai Stock Exchange Issues Warnings to Two Private Fund Managers Over IPO Pricing Violations

Several private fund managers have received regulatory warnings from the Shanghai Stock Exchange for violations during offline bookbuilding for initial public offerings. Junzhijian Investment and Haiyizhiyuan Investment were both subject to regulatory measures over irregularities in the offline pricing process.

Junzhijian Investment was established in November 2015 and completed registration and filing in December of the same year. It currently has 18 full-time employees and manages more than RMB 10 billion. In the three months from June 17, 2026 to September 17, 2026, 23 private fund products under Junzhijian Investment were allotted shares in initial public offerings, with cumulative allotted investment of RMB 19.459 million. Of these, 10 products received allotments more than 20 times. In 1945, Junzhijian Investment had a private fund product placed on the China Securities Association's restricted list for IPO allotment targets for six months due to violations during offline bookbuilding for the first batch of new share issues on the STAR Market.

Haiyizhiyuan Investment was established in February 2014 and completed registration and filing in January 2015. It currently has 12 full-time employees and manages between RMB 1 billion and RMB 2 billion. In the past three months, seven private fund products under Haiyizhiyuan Investment were allotted shares in initial public offerings, with cumulative allotted investment of RMB 2.1624 million.

Since the start of 2026, three other private fund managers, Guangzhou Yiben Investment, Shenzhen Zhixingtongda Private Fund, and Shanghai Xitai Investment, have also received regulatory warnings from the Shanghai Stock Exchange for violations during offline bookbuilding for initial public offerings. Shanghai Xitai Investment and Shenzhen Zhixingtongda Private Fund each manage more than RMB 10 billion, while Guangzhou Yiben Investment manages between zero and RMB 500 million. Shanghai Xitai Investment and Guangzhou Yiben Investment received self-regulatory measures from the China Securities Association on the same day, September 1, 2026. In April 2026, Lin Yuan Investment, a private fund manager with assets of RMB 10 billion, was subject to self-regulatory measures by the China Securities Association requiring corrective action and participation in compliance education.

Over the past three months, a total of 4,936 sunshine private fund products were allotted shares in initial public offerings, with cumulative investment of RMB 4.436 billion. The offline new share subscription process is cumbersome and has strict time windows for filings. Some private fund managers use a multi-account simultaneous filing model, facing tight deadlines and heavy workloads with each quotation, making operational oversights more likely. Some private fund managers have not established standardized investment decision-making processes and checks and balances internally.