Analysis of Related Party Transactions and Regulatory Concerns in Bangze Chuangke's IPO

Based on search results, I will provide you with a detailed analysis of the related party transaction issues in Bangze Chuangke’s IPO and the hidden risks in Dongguan Securities’ sponsorship qualification.

Bangze Chuangke (Guangdong Bangze Chuangke Electric Co., Ltd.) is scheduled to hold its initial public offering (IPO) review meeting at the

on , with a planned fundraising amount of RMB 400,321,200, to be used for the Bangze Chuangke Electric Intelligent Manufacturing Base Project and the Headquarters and R&D Center Project[1][2]. The company’s main business is the R&D, production, and sales of office appliances and household electrical appliances, operating through ODM sales via overseas supermarkets/internet channels and e-commerce sales of self-owned/authorized brands.

According to the prospectus and the responses to regulatory inquiry letters, Bangze Chuangke has multiple related party transaction issues involving former employees[1][2][3]:

• Dongguan Weipute Technology Co., Ltd.
  is simultaneously among Bangze Chuangke’s top five suppliers and outsourcing suppliers
• Chen Yuanhong, a former employee of the company (resigned on July 1, 2019, served as Quality Director before resignation), and his spouse Zeng Shuai hold positions as consultants and senior management (directors, supervisors, and senior executives) in the company

• Dongguan Naoli
  is an outsourcing supplier of the company
• Zhang Yong, the actual controller and Vice Chairman of Bangze Chuangke, and his wife Cao Ping once held 30% and 50% equity interests in Dongguan Naoli respectively
• Zhang Yong and his daughter Zhang Yahuan once served as supervisor and financial director of the company respectively

• The company has a history of equity holding on behalf of others
• The employee shareholding platform includes resigned employees, such as Liu Zhiyong (resigned on July 29, 2022, served as Head of Quality Assurance Department before resignation) and Chen Yuanhong

The Beijing Stock Exchange has focused on the following issues during the review[2][3]:

• Abnormal gross profit margin during the reporting period: The gross profit margins in 2022, 2023, and 2024 were 28.8%, 39.4%, and 40.1% respectively, far exceeding the industry peers’ average of 30.8%, 31.9%, and 30.3%
• R&D expense ratio is less than 3%, lower than the industry average of over 4%
• Amazon, the largest customer, did not reply to confirmation letters in accordance with commercial practices, resulting in a significant decline in the overall reply rate in 2024

• During the reporting period, there were internal control irregularities such as collections and payments via personal bank cards, cash receipts and payments, third-party collections, and payment collection by related parties
• A total of RMB 1,615,900 was collected via personal bank cards in 2022
• Fund borrowings from related parties such as the actual controller and his relatives amounted to RMB 36,364,800
• There were fund transactions of approximately RMB 2,000,000 between key management personnel and supplier personnel

As the sponsoring institution of Bangze Chuangke, Dongguan Securities has multiple regulatory records[4][5]:

Time	Regulatory Authority	Reason for Warning
July 2024	Shanghai Stock Exchange	Failed to effectively manage client trading behaviors found in on-site inspection, and was subject to self-regulatory supervision measures
May 2025	Guangdong Securities Regulatory Bureau	As the sponsoring institution for Quanwei Technology’s IPO, it failed to prudently verify the authenticity of large-sum fund transactions, failed to fully fill out the 2019 on-site inspection report in accordance with regulations; warning letters were issued to sponsor representatives Yao Genfa and Yang Na
November 2025	Shanghai Stock Exchange	Frequent abnormal client transactions still occurred after multiple self-regulatory management actions, and was given a written warning
2025	Beijing Stock Exchange	Issued a verbal warning to projects sponsored by Dongguan Securities (e.g., Keli Co., Ltd.)

Dongguan Securities’ sponsorship business has the following risk points:

• Compliance Management Defects
  : Received warnings multiple times for ineffective management of client trading behaviors, with poor rectification effects
• Professional Quality Flaws
  : Insufficient verification of large-sum fund transactions during continuous supervision
• Reputational Risk with the BSE
  : As a sponsoring institution, it already has a record of verbal warnings from the Beijing Stock Exchange

Based on the above analysis, Bangze Chuangke’s IPO has the following risks:

1. Doubts About Fairness of Related Party Transaction Pricing
   : The rationality of transaction pricing with suppliers associated with former employees and related parties requires focused attention
2. Difficulty in Verifying the Authenticity of Business Performance
   : Non-reply from major customers such as Amazon has led to limited verification scope
3. Doubts About the Professional Competence of the Sponsoring Institution
   : Dongguan Securities’ historical regulatory records may affect investor confidence

: Investors should pay close attention to the review result of the Beijing Stock Exchange’s deliberation meeting on January 8, 2026, especially the regulators’ final determination on the standardization of the company’s related party transactions and the effectiveness of its internal control.

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[1] Sina Finance - Bangze Chuangke’s IPO: Reliant on Major Customer Amazon, Authenticity of Performance Growth Questioned (https://cj.sina.cn/articles/view/7935425109/1d8fcfa5502001bpdi)

[2] Caizhong News - Bangze Chuangke’s IPO: Reliant on Major Customer Amazon, Authenticity of Performance Growth Questioned (https://m.rccaijing.com/news-7387375008484095231.html)

[3] East Money - Who Will Be the Lucky One for the First IPO Approval in 2026? The Rhythms of the Three Exchanges Diverge (https://finance.eastmoney.com/a/202601073611563718.html)

[4] Phoenix Net Finance - Guangdong Securities Regulatory Bureau Issues Warning Letters to Dongguan Securities and Two of Its Sponsor Representatives for Violations in Sponsorship Business (https://finance.ifeng.com/c/8ZYAbGv4wEc)

[5] Southern Plus - Dongguan Securities Given Written Warning Due to Frequent Abnormal Client Transactions (https://www.nfnews.com/content/5ypplgM2yp.html)