Some Factors Influencing IPO Underpricing: Evidence from Indonesian Firms

Firman Syarif, Nurzaimah

2019

Abstract

The purpose of this paper is to investigate some factors influencing the underpricing of initial public offerings (IPOs). The intention is to determine whether IPO firms –particularly those in certain firms of the market where information asymmetry is likely to be greatest can benefit from significantly better IPO pricing by engaging the services of differentiated reputation parties. The paper examines a broad sample of initial public offerings made between 2014-2017. It also conducts multivariate tests to assess the influence of percentage of stock offer, industry specialization, Auditor reputation and underwriter reputation on IPO underpricing. The paper finds that IPOs audited by big 4 firms and underwriter reputation experience affect significantly negative on underpricing but Industry specialization and percentage of stock offer don’t influence at all. The results in this paper may not be generalizable to different countries. They do, however, appear to be robust in Indonesia throughout the four-year sample period. The paper shows that it may not be feasible for all clients in certain firms of the market. However, if they can the results suggest that they could benefit from better IPO pricing.

Paper Citation

in Harvard Style

Syarif F. and Nurzaimah. (2019). Some Factors Influencing IPO Underpricing: Evidence from Indonesian Firms. In Proceedings of the 2nd Economics and Business International Conference - Volume 1: EBIC, ISBN 978-989-758-498-5, pages 413-426. DOI: 10.5220/0009206504130426

in Bibtex Style

@conference{ebic19,
author={Firman Syarif and Nurzaimah},
title={Some Factors Influencing IPO Underpricing: Evidence from Indonesian Firms},
booktitle={Proceedings of the 2nd Economics and Business International Conference - Volume 1: EBIC,},
year={2019},
pages={413-426},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0009206504130426},
isbn={978-989-758-498-5},
}

in EndNote Style

TY - CONF

JO - Proceedings of the 2nd Economics and Business International Conference - Volume 1: EBIC,
TI - Some Factors Influencing IPO Underpricing: Evidence from Indonesian Firms
SN - 978-989-758-498-5
AU - Syarif F.
AU - Nurzaimah.
PY - 2019
SP - 413
EP - 426
DO - 10.5220/0009206504130426