<p>This paper examines how the intragroup resource sharing, which includes technical knowledge, financial support, personnel mobility and insourcing of business activities, within domestically and foreign-managed enterprise groups affects innovation outcomes in emerging innovation systems. We examine the impact of these factors on the likelihood of innovation project abandonment, the commercial success of innovations and the extent to which innovations meet organisational expectations. The results show that relying on intra-group resources increases the likelihood of innovation abandonment and at the same time has a negative impact on the commercial success of novel products. These results emphasise the restrictive role of enterprise groups, especially those led by foreign companies, in shaping the innovation capabilities of their affiliates. The observed dynamics are consistent with the competence trap effect predicted by agency theory. The study provides new insights into the interplay between enterprise groups and innovation outcomes in transitional contexts.</p>