Certification role of transparency and anchor investors in Indian IPOs

Sweta Agarwal

Afro-Asian Journal of Finance and Accounting, 2021, vol. 11, issue 1, 35-63

Abstract: The study examines the effect of bidding information of anchor and other institutional investors, on retail investors' subscription and short-term IPO performance in the Indian market. The study also tries to find out specific anchor investors' characteristics which influence investor decisions. The results show that anchor investors play a certification role for institutional investors only. Both institutional and retail investors follow bids of each other during the book-building period. High institutional and retail subscriptions have a positive effect on initial returns. In anchor-backed IPOs, unique business group participation and anchor over-subscription have a high positive impact on both subscription and IPO initial returns.

Keywords: book building process; anchor investors; institutional investors; retail investors; subscription; underpricing. (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:ids:afasfa:v:11:y:2021:i:1:p:35-63

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