Despite high levels of asymmetry of information, firms that issue SEOs within a year of their IPO (follow-on SEOs) are able to offer shares at a lower discount compared to more mature firms. We provide evidence that this seeming contradiction can be explained by a very high degree of demand for...

The price formation process of JASDAQ IPOs is more transparent than in the United States. The transparency facilitates analysis of important issues in the IPO literature — why offer prices only partially adjust to public information and adjust more fully to negative information, and why...

In the Japanese initial public offering (IPO) market, initial first-day and one-year aftermarket returns are unusual, with a mean (median) of 0.417 (0.314) and −0.322 (−0.316), respectively. Our study relates this result to a globally popular book building pricing system that is blended with...

We find a negative relation between democracy and initial public offering (IPO) underpricing for a sample of 23,050 IPOs across 45 countries. The effect of democracy on underpricing is weaker for IPOs audited by Big 4 auditing firms, backed by venture capital firms, and with better disclosure...

This paper investigates the role of information precision in IPO pricing. The model shows that more precise information will exert more influence on the offer price. In strong support of the model, I find that the proportion of the industry return during the waiting period that is incorporated...

The issuer underpricing hypothesis addresses why IPOs with a Directed Share Program (DSP) are substantially more underpriced and why the issuers are not upset over the additional money left on the table. In support of the hypothesis, we find that both the final size and likelihood of DSP...

This paper examines the size-return relationship in the primary stock market. For 529 Japanese IPOs between 2010 and 2018, we empirically argue that the channel which connects offer size and underpricing is information-based and bidirectional. We find an endogenous effect of both offer and firm...

Using a large sample of 13,674 initial public offerings (IPOs) from 37 countries, we find that trading rules on market manipulation reduce IPO underpricing. The effect is weaker for IPOs certified by reputable intermediaries, in countries with greater shareholder rights protection, better...

SME (Small & Medium Enterprises) IPOs formally debuted in India in 2012 when BSE and NSE introduced SME Platform on their exchanges along with Main Board Platform (for non-SMEs). SEBI has eased the listing criteria for SMEs to make it more attractive. The focus of this study is to assess and...