tailieunhanh - Investor expectations on ‘return’ and ‘trust’ on IPO grading: an empirical analysis

The study attempts to provide insights to investors on how significantly efficient the listing prices of oversubscribed shares between 1 to 5 grades by approved rating agencies are; as well as the profitability in investing oversubscribed IPOs with respect to the 1) Close price of the listing day 2) Short term and 3) Long term returns in both manufacturing and service sector. | Investor expectations on return and trust on IPO grading an empirical analysis International Journal of Management IJM Volume 7 Issue 3 March-April 2016 pp. 172 184 Article ID IJM_07_03_016 Available online at http IJM JType IJM amp VType 7 amp IType 3 Journal Impact Factor 2016 Calculated by GISI ISSN Print 0976-6502 and ISSN Online 0976-6510 IAEME Publication INVESTOR EXPECTATIONS ON RETURN AND TRUST ON IPO GRADING AN EMPIRICAL ANALYSIS Biju Thomas Muttath Head Finance Star Group Research Scholar R amp D Centre Bharathiar University Coimbatore 46 India Dr. Assissi Menachery Professor Loyola Institute of Technology amp Science Dist India ABSTRACT Oversubscription during IPO is the result of demand over supply due to investors keen interest and expectation to subscribe new shares. Grading agencies play a major role in attracting investors to subscribe shares during IPO. This is due to the trust that investors have on the grading agency regarding its capability to perform research on the key fundamental indicators. Informed and knowledgeable investors act vigorously to get maximum shares during the initial public offer. Book building pricing method plays vital role in attracting the investors who anticipate efficient price discovery. The study attempts to provide insights to investors on how significantly efficient the listing prices of oversubscribed shares between 1 to 5 grades by approved rating agencies are as well as the profitability in investing oversubscribed IPOs with respect to the 1 Close price of the listing day 2 Short term and 3 Long term returns in both manufacturing and service sector. Key words Book building Grading Hot Issue Market IPO Under-pricing Cite this Article Biju Thomas Muttath and Dr. Assissi Menachery Investor Expectations on Return and Trust on IPO Grading An Empirical Analysis. International Journal of Management 7 3 2016 pp. 172 184. http IJM JType