Global IPO underpricing during the Covid-19 pandemic: The impact of firm fundamentals, financial intermediaries, and global factors

Zikai Zhang and Suman Neupane

International Review of Financial Analysis, 2024, vol. 91, issue C

Abstract: We investigate the impact of the Covid-19 pandemic on global IPO underpricing. Using a sample of 6113 IPOs from 32 countries, we find that firms issued during the pandemic have 17.6% more underpricing than those issued before the pandemic. We also analyze the effect of firm fundamentals, financial intermediaries, and global factors on pandemic-era underpricing. Firms with strong fundamentals and backed by reputable underwriters have higher underpricing during the pandemic. Furthermore, better country-level shareholder protection and ESG performance reduce underpricing, while higher economic policy uncertainty increases underpricing during the pandemic. Government economic support positively affected underpricing during the pandemic.

Keywords: Covid-19 pandemic; IPO underpricing; Uncertainty (search for similar items in EconPapers)
JEL-codes: G12 G15 G18 G32 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:91:y:2024:i:c:s1057521923004702

DOI: 10.1016/j.irfa.2023.102954

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