Underpricing and long-term market performance of initial public offerings in Indonesia: A quantile regression approach

Title: Underpricing and long-term market performance of initial public offerings in Indonesia: A quantile regression approach

Authors: Nugroho Sasikirono¹, Sumiati Sumiati², Nur Khusniyah Indrawati²

Affiliations: 1. Faculty of Economics and Business, Universitas Airlangga, Indonesia; 2. Faculty of Economics and Business, Brawijaya University, Indonesia

Publisher: Business and Economic Horizons (BEH) Volume 14 2018

Abstract

This study aims to identify the relationship between underpricing and long-term market performance of IPOs in the Indonesian Stock Exchange (IDX), as well as determinants of IPOs' market performance. We based our paper on the idea that it is more meaningful and relevant to investigate underpricing and long-term market performance determinants at different distribution points. OLS and quantile regression analysis is applied to 105 samples of IPOs during 2009-2013. The results of OLS and quantile regressions indicate that assets value, age, proceeds, and underwriters’ reputation are determinants of long-term market performance; while assets, age and proceeds also become underpricing determinants. Among these factors, proceeds become the most important determinant of underpricing and long-term market performance.

Keywords: Underpricing, long-term market performance, Indonesia, quantile regression

Sources: https://academicpublishingplatforms.com/article.php?journal=BEH&number=30&article=2506