1. In the post-epidemic era, the global economy is facing deflation and stagflation, geopolitical relations are deteriorating, protectionism is becoming increasingly intense, and the risks and uncertainties that China's economic development has to deal with are increasing. Urban investment companies are also facing three major changes, and transformation is imminent. The first change is the slowdown in China's urbanization process. After more than 20 years of rapid development, China's population urbanization rate has reached 65 in 202222%, the slowdown in the urbanization process has led to a decline in the demand for traditional infrastructure, and the traditional infrastructure construction business of urban investment companies has shown a contraction trend. The second change is the change in land finance. In the past 10 years, the income from the transfer of state-owned land use rights has been the main income of the local government, however, the national budget revenue in 2022 will be 7,787.9 billion yuan, a year-on-year decrease of 206%, of which the largest proportion of state-owned land use right transfer income was 6,685.4 billion yuan, down 23.4 billion yuan year-on-year3%, which means that the main income of the local government is facing a contraction. The local financial situation is weak and financial resources are under pressure, and urban investment companies, as local investment and financing platforms, are facing a more severe investment and financing situation. The third change is the change in the liquidity of urban investment debt under the policy contraction. As the most important financing tool for local governments, urban investment bonds have expanded rapidly since 2008 under the background of active fiscal and monetary policies, forming a large number of local debts, and increasing the debt liquidity risk of urban investment companies. In order to deal with a large number of problems left over from the rapid development of urban investment bonds, since 2014, policies and regulations have been intensively introduced to strictly control the growth of local debt, break the rigid payment of urban investment bonds, and the liquidity problem of urban investment debt has surfaced. On December 30, 2022, Zunyi Road and Bridge, the largest urban investment company in Zunyi, extended its debt, according to the results of its negotiations with various banking financial institutions, its 155The 9.4 billion bank loan is extended for 20 years, and the first 10 years only pay interest and do not repay the principal, and the second 10 years repay the principal in installments. 2. Several models of successful transformation of urban investment companiesIn the face of the three "swords of Damocles" such as the slowdown of the external urbanization process, the weak land financial situation, and the tightening of the urban investment bond policy, there are problems such as poor asset quality, high debt ratio, unclear main business, poor profitability, and poor cash liquidity. At present, there are three main models for the successful transformation of urban investment companies: industrial incubation + first-class investment, industrial park development and operation + industrial investment, and comprehensive public utilities services. The first model is Hefei Construction Investment, they have set up a number of strategic emerging industries such as industrial layout displays, large-scale integrated circuits, new energy vehicles, etc., and invested in star enterprises such as iFLYTEK, BOE, Changxin Semiconductor, and Weilai Automobile, effectively helping the regional industrial transformation and upgrading. The second model is benchmarked by companies such as Suzhou Industrial Park Development Group and Zhangjiang Hi-Tech, which have set an example in terms of park development, park services, and industrial investment. Taking Suzhou Industrial Park as an example, the development and prosperity of the industrial park has promoted the growth of local fiscal and tax revenues, and the increased fiscal revenues have been used for local infrastructureThe introduction of population and the improvement of infrastructure facilities have also helped the growth of land transfer, forming a virtuous circle. The third model is typified by Shanghai Chengtou, which has a strong monopoly in the public utilities sector in the region, and obtains stable income and cash flow through public utilities such as water and environment. 3. Brief description of KG Group, as an urban investment company affiliated to Shuangliu District, Chengdu, was mainly responsible for the construction of road traffic and other infrastructure in Shuangliu District after its establishment in 2008, and was reorganized into a comprehensive group company in 2019, with business covering infrastructure, public utilities, real estate, park operation and many other fields. KG Group has a registered capital of 15 billion yuan and total assets of 682 at the end of 20224.4 billion yuan, total liabilities 392600 million yuan, net assets of 2898.4 billion yuan, with an asset-liability ratio of 5753%;Income 239.3 billion yuan, net profit of 26.5 billion yuan, return on net assets 091%;The corporate entity rating is AA+. In recent years, KG Group has developed rapidly in the real estate sector, vigorously participating in the development of urban residential and commercial facilities, and it is expected that about 800,000 square meters of commercial carriers will be launched in the next three years. From the perspective of the integration of "investment, financing, construction, management and operation", KG Group's current business focus is on "financing" and "construction". In the future, with the advent of large-scale commercial carriers and the needs of economic transformation in Shuangliu District, the business focus of KG Group will gradually shift to "investment" and "operation", and transform from a local "financing SPV company" to an "urban investment and operation company". The city investment company and the local government share weal and woe, and the study of the transformation strategy of KG Group is inseparable from the analysis of the economic situation in Shuangliu District. Shuangliu District is located in the southwest of the central urban area of Chengdu, and was withdrawn from the county in 2015. It is located in Chengdu Shuangliu International Airport, which is an important airport economic development zone in Chengdu and ranks among the top 100 districts (counties) in the country all year round. With the commissioning of Tianfu International Airport in June 2021, Shuangliu's status as an aviation economic hub in the west has been impacted. During the same period, the era of real estate came to an end, and the economic cycle of local governments relying on the income from the transfer of land use rights to develop local infrastructure construction gradually declined. In 2022, the GDP of Shuangliu District will be 113.1 billion yuan, with an increase of only 06%, the new increase is lower than the city's average, and economic growth is weak. Among the top 30 industrial output values above designated size according to recent statistics, 22 have been developed in Shuangliu for more than 10 years, accounting for 72% of the output value of the whole regionThe four 10-billion-level enterprises account for more than 60% of the industrial output value above designated size, and the production time is more than 5 years4. It can be seen that the largest contribution to the development of Shuangliu is more than 5 years of stock enterprises, lack of follow-up project support. The economic system of Shuangliu District is facing transformation, and the industrial structure needs to be adjusted and upgraded urgently to find new economic growth points. In 2023, the work report of Shuangliu District will clearly focus on industrial development, adhere to the industrial circle and strong chain to change the economic organization mode, and take the road of industry first, manufacturing first, and secondary and tertiary industries linkagePromote the specialization of the producer service industry, make good use of the airport business district, Yixin Lake and other building carriers, and strengthen scientific and technological research and development, brand marketing, headquarters economy and other formats;Vigorously build an industrial park based on Xikai District, Chengdu Xingu and Tianfu International Biological City. Fourth, the transformation strategy analysis and path analysis of KG GroupCombined with the development goals of Shuangliu District and the endowment characteristics of KG Group, the transformation of KG Group has the following ideas. First, we can't and shouldn't get rid of the close relationship between the enterprise and the company. KG Group, as a financial investment company funded by Shuangliu District, will inevitably undertake the public welfare and quasi-public welfare business assigned by Shuangliu District, which is the mission of the urban investment company. Second, land is still the core element. As one of the core districts and counties of Chengdu, an important town in the west, Shuangliu District still has a relatively high value for its land. The KG Group should carry out the land in a market-oriented manner.
First, second, the first development, so that it has become an important driving force for the development of KG Group. Third, combined with the transformation of the economic system of Shuangliu District and KG's own resource endowment, industrial investment and asset operation and management are the only way for KG Group's transformation, and it is also the top priority of KG Group's transformation. Industrial investment promotes local investment and boosts the transformation and upgrading of local industries, which is the key for KG Group to adjust its foothold and realize its own value in accordance with the development and changes of the city. Revitalizing assets, improving asset efficiency and increasing asset efficiency are the core competitiveness of KG Group in the "asset era", and it is also a prerequisite for broadening financing channels. Fourth, the continuous expansion of diversified financing capabilities is an important guarantee for the development of KG Group. As real estate development, infrastructure construction and industrial investment require a large amount of capital, it is particularly important to build a diversified financing system, including trying new financing channels such as REITs and ABS, giving full play to the role of listing as a booster for the company's development, and using the leverage effect and flexibility of the company. Fifth, we should make good use of digital means to empower businesses, pay attention to selecting and employing people to provide talent guarantee for transformation, and introduce market-oriented forces to improve quality and efficiency for transformation through mixed ownership. Due to the large number and complexity of KG Group's business segments, the transformation strategies that correspond to the focus of different business segments are different, and the following will be elaborated on by business segments. First, for the two traditional businesses of public utilities such as road infrastructure construction, bus operation and parking lot operation, the transformation should mainly focus on digital transformation and empowerment. The first aspect is digital transformation, which is an important means of transformation of urban investment companies. In the process of digital transformation, KG Group should test the waters and promote at the same time, first starting from the business pain points, going deep into the single business scenario, and forming a solution with advantages, adaptability and systematization, which not only ensures the safety of digital transformation, but also ensures the transformation effect. Combined with the energy level of Shuangliu District and the comprehensive situation of KG Group itself, smart city sectors such as smart parking lots, smart charging piles, smart buses (or transportation), and smart street lights are suitable entry points for the first place, and then gradually involved in real estate and park businesses in the later stage, including smart construction sites, smart marketing, smart properties, as well as the digitalization of asset operations such as commercial real estate, industrial parks, and rental housing. The second aspect is empowerment. Due to the current lack of local finance and limited debt, KG Group has undertaken many projects with public welfare properties in the form of "market-oriented undertaking", which actually do not have market-oriented profitability, so it needs local empowerment support while undertaking it. **The core premise of empowerment comes from KG Group's accurate and professional project investment analysis (the most important form of presentation is investment calculation) and reasonable and feasible empowerment solutions. The content of empowerment takes various forms, including but not limited to financial subsidies, support policies, land and resource empowerment, concession rights, local administrative approvals or local monopoly industry access, etc. For example, the Chongqing Zengjiayan Bridge adopts a shadow regulation subsidy, that is, it does not charge directly for passing vehicles, but pays road use fees to the urban investment company responsible for construction and operation on a regular basis according to the traffic flow detected. Second, for the fast-growing future pillar businesses of real estate and parks, the transformation should focus on improving development efficiency, enhancing operational capabilities, broadening financing channels, and deepening the unique government and enterprise advantages of urban investment companies. The first aspect is to improve development efficiency. Real estate and park projects are both capital-heavy businesses, and improving development efficiency means saving development costs. Due to the high compliance requirements of state-owned enterprises, the decision-making and bidding process of such large-scale capital investment construction projects involves many links and a long time, resulting in a longer development cycle of real estate and park projects than similar market-oriented private enterprises. The second aspect is to enhance operational capabilities. Assets are not a one-shot deal, and the project also involves later operation and management after completion. Excellent operation management helps realize the value of assets, and is also an important prerequisite for broadening financing channels. The starting point for the development of KG Group's asset operation and management is to explore a variety of business methods such as entrusted management and joint operation with the help of strength and platformization, and build an asset management platform integrating investment management, property management and operation management. The third aspect is to broaden financing channels. Real estate and park assets have accumulated a large amount of funds, and the issuance scale of traditional debt financing instruments is limited. In the future, relying on real estate and park assets with good operating cash flow, the issuance of asset-based products including but not limited to ABS, CMBS, quasi-REITs and public REITs will complement bank loans and bond financing, which is an important way for KG Group to revitalize asset cash flow and increase financing. The fourth aspect is to deepen the unique advantages of government and enterprises of urban investment companies. Through the unique shareholder resource endowment, KG Group consolidates and optimizes the development of the secondary land market, actively participates in the preparation of the primary land market in Shuangliu District, explores the linkage of the primary and secondary land markets, and participates in various land development models such as urban renewal and area development, so as to ensure the development of the enterprise while serving the development of the city. Third, for the emerging transformation business of industrial investment, the transformation idea is to rely on the deep linkage of industrial parks with industries, and use various means such as industry first-class and mergers and acquisitions of listed companies to create a professional industrial investment platform. The successful mode of industrial investment of urban investment companies can be roughly summarized into two types: one is the industrial investment model represented by Zhangjiang Hi-Tech and Suzhou Industrial Park Development Group, which is represented by the industrial park, and Chengdu Bio-City, in which Shuangliu District is a shareholder, also belongs to this model;The other is the incubation industry investment model represented by Hefei Construction Investment and Shenzhen Venture Capital, which has the uniqueness of talents, institutional system and timing, and Shenzhen Capital has unique location advantages. In contrast, the first model is more useful for KG Group. KG Group should combine the industrial layout strategy of Shuangliu District and the resource endowment of its own industrial park, make full use of the industrial and public capital markets, focus on the three leading industries in Shuangliu District, biomedicine, electronic information, aerospace and the cultivation of emerging strategic industries, and actively promote the development of industrial investment business. The focus of investment is not only on pre-investment demonstration, but also on post-investment management and empowerment, and building the investment capability of the whole life cycle is the core competitiveness of the industrial investment business. A major grasp of industrial investment is the industry of the mother-child model. The mother-child model can fully leverage social capital, introduce specialized investment institutions, promote resource integration and improve allocation efficiency, and reduce the risk of state-owned assets decision-making. In recent years, the local "matrix" has gradually grown, and the industry has blossomed all over the country. In the first half of 2023 alone, Shanghai, Shenzhen, Suzhou, Huzhou, Chengdu High-tech Zone and other places will set up tens of billions of scale industries**, of which Chengdu High-tech Zone will set up an industrial investment of 60 billion yuan**, 40% will be invested in the electronic information industry, 20% will be invested in the biomedical industry, 20% will be invested in the new economy industry, and 20% will be invested in other industries including modern service industries and future industries, especially focusing on hard-core technology and advanced manufacturing projects. Another major grasp of industrial investment is to become a listed company. Becoming a listed company can enhance the industrial influence, help the industry guide and attract investment, thereby driving the economic development of the park and promoting the upgrading of regional industries. For the 3,414 urban investment companies with outstanding debts, a total of 412 urban investment companies have invested in listed companies (top 10 shareholders), involving 575 listed companies. For example, Chengdu Xingcheng Investment Group has successively acquired Sinochem Geotechnical and Hongri Pharmaceutical, the former has helped it realize the industrial linkage of construction and petrochemical construction, and the latter has filled the gap of Chengdu Xingcheng in the field of medicine and health, so that it has completed the layout of the pharmaceutical field and enhanced the influence of the pharmaceutical industry. 
5. ConclusionThe transformation of urban investment companies affects the whole body, which not only affects the financial security of platform companies and local governments, but also affects the stability of the national financial system and the stability and improvement of people's lives. The successful transformation of urban investment companies will be one of the important factors for the successful transformation of China's financial system. In the context of major changes unseen in a century, opportunities and challenges coexist for the development of urban investment companies. The complex international situation, the slowdown of urbanization, the weakening of the endorsement, and the tightening of risk management and control have made the transformation of urban investment companies increasingly urgentThe "dual circulation" development pattern, the "two new and one heavy" plan, and the "promotion of high-quality economic development" have made the urban investment company stand at the turning point of the times and welcome the huge development opportunities in the future. However, the transformation cannot be achieved overnight, first of all, it needs to get the active support and cooperation of the first and all parties, and the strong support of the first Shuangliu District, so that KG Group can achieve a smooth transformation. Secondly, as the core subject of urban infrastructure construction in Shuangliu District, the resource endowment accumulated in the years of development is the cornerstone of KG Group's transformation and development. KG Group should pay attention to land elements, practice the internal skills of asset operation and management, improve the efficiency of asset management, and build a high-level asset operation and management platform. Finally, KG Group should grasp investment and financing with both hands, broaden financing channels, create a diversified financing system, vigorously develop industrial investment in line with the industrial layout of Shuangliu District, use industry and listed companies to build an industrial investment platform, and strive to transform from a local "financing SPV company" to an "urban investment consulting operation company". In February 23, 12 24, offline open classes were held in first-tier cities across the country, and the class schedule was finally updated (human resources, finance, office, investment and financing, PPP, bidding, construction, etc.).