Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/21742
Title: IPO underpricing in China's new stock markets
Authors: Chen, G
Firth, M
Kim, JB
Keywords: China's stock markets
IPOs
Underpricing
Issue Date: 2004
Source: Journal of multinational financial management, 2004, v. 14, no. 3, p. 283-302 How to cite?
Journal: Journal of Multinational Financial Management 
Abstract: China's recent economic reforms have included the privatization and listing of many state-owned enterprizes (SOEs). This study investigates the pricing of initial public offerings of A-shares sold to domestic investors and B-shares sold to foreign investors. Our data consist of 701 A-share IPOs and 117 B-share IPOs that listed in the period 1992-1997. The median initial return on A-share IPOs is 145% while the median underpricing of B-shares is just 10%. We find that risk is strongly and positively associated with the underpricing of A-shares. High government and legal entity shareholdings are also associated with underpricing. B-share underpricing is positively related to seasoned equity offerings (SEOs) and government ownership. We find that underpricing is a positive function of the relative price-to-book ratio and the relative price-earnings multiple. Our study gives some insights into the pricing of new issues on China's stock exchanges.
URI: http://hdl.handle.net/10397/21742
ISSN: 1042-444X
DOI: 10.1016/j.mulfin.2003.07.007
Appears in Collections:Journal/Magazine Article

Access
View full-text via PolyU eLinks SFX Query
Show full item record

SCOPUSTM   
Citations

70
Last Week
0
Last month
2
Citations as of Aug 14, 2017

Page view(s)

41
Last Week
3
Last month
Checked on Aug 13, 2017

Google ScholarTM

Check

Altmetric



Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.