Exploring Detriments of China IPO Underpricing: An Empirical Evidence from A-share IPO

Yixin Chen ()
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Yixin Chen: The University of Manchester, School of Social Sciences

A chapter in Proceedings of the 2022 International Conference on Economics, Smart Finance and Contemporary Trade (ESFCT 2022), 2022, pp 1454-1466 from Springer

Abstract: Abstract As an important method for the financing purpose of listed companies, an initial public offering (IPO) is a vital connection between companies and investors and is also the necessary foundation for the development of financial markets. However, since the 1970s, IPOs are observed consistently being underpriced around the world. This article selects China which is one of the most underpriced countries as the sample. With the empirical support from the ordinary least square regression method (OLS) based on the Chinese A-share IPO figure, aiming to explore the sources of the IPO market underpricing phenomenon. Besides, this article also discusses China-specific financial market characteristics and assesses the effect of past Chinese stock market policy changes.

Keywords: IPO Underpricing; Information Asymmetry; Corporate Governance; China Stock Market Policy Changes (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-052-7_161

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DOI: 10.2991/978-94-6463-052-7_161

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