Underwriter Reputation, Issuer-Underwriter Matching, and SEO Performance

The objective of this research is to obtain empirical evidence about the effect of underwriter reputation, company age, and the percentage of share’s offering to public toward underpricing. Underpricing is a phenomenon in which the current stock price initial public offering (IPO) was lower than the closing price of shares in the secondary market during the first day. Sample in this research was selected by using purposive sampling method and the secondary data used in this research was analyzed by using multiple regression method. The samples in this research were 72 companies conducting initial public offering (IPO) at the Indonesian Stock Exchange in the period January 2010 - December 2014; perform initial offering of shares; suffered underpricing; has a complete data set forth in the company's prospectus, IDX monthly statistics, financial statement and stock price site (e-bursa); and use Rupiah currency. Results of this research were (1) underwriter reputation significantly effect on underpricing; (2) company age do not effect on underpricing; and (3) the percentage of share’s offering to public do not effect on undepricing. Keywords: company age, the percentage of share’s offering to public, underpricing, underwriter reputation.

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APAKAH FAKTOR EKSTERNAL MEMPREDIKSI UNDERPRICING LEBIH BAIK DIBANDINGKAN FAKTOR INTERNAL? STUDI INITIAL PUBLIK OFFERING DI BEI TAHUN 2009-2017

JMBI UNSRAT (Jurnal Ilmiah Manajemen Bisnis dan Inovasi Universitas Sam Ratulangi). ◽

10.35794/jmbi.v7i1.28178 ◽

2020 ◽

Vol 7 (1) ◽

Author(s):

Saefudin Saefudin ◽

Tri Gunarsih

Keyword(s):

Interest Rates ◽

Initial Public Offering ◽

Stock Exchange ◽

Sample Selection ◽

Secondary Data ◽

Secondary Market ◽

Company Size ◽

Negative Effect ◽

Underwriter Reputation ◽

Public Offering

Underpricing is a phenomenon that still occurs in the Indonesian capital market, where the offering price of shares in the primary market is lower than the opening price or closing price on the first day on the secondary market. This study aims to examine the effect of Return On Assets (ROA), Debt to Equity Ratio (DER), company size, underwriter reputation, age, and interest rates on the underpricing of shares in companies’s Initial Public Offering (IPO) listing on the Indonesia Stock Exchange (BEI) in 2009 to 2017. The population in this study are companies that conduct IPOs on the BEI period 2009 to 2017. The sample selection in this study uses a purposive sampling method, based on certain criteria. The sample in this study were 183 underpricing companies from 205 companies conducting IPO in the period 2009 to 2017. The data used in this study used secondary data. The multiple regression analysis was implemented in this study. The results showed that DER, company size, and underwriter reputation did not significantly influence underpricing. While ROA, age and interest rates have a significant negative effect on underpricing. In this study, investors consider ROA, age, interest rates compared to DER, company size, and the reputation of the underwriter to invest in companies that make an IPO.Keywords: Underpricing, Initial Public Offering, and Indonesian Stock Exchange.

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Impact of underwriter reputation on the accounting conservatism of the IPO firm: South Korean cases

International Journal of Economic Policy in Emerging Economies ◽

10.1504/ijepee.2018.093950 ◽

2018 ◽

Vol 11 (3) ◽

pp. 238 ◽

Cited By ~ 1

Author(s):

Na Youn Kim ◽

Kook Jae Hwang

Keyword(s):

Accounting Conservatism ◽

South Korean ◽

Underwriter Reputation

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ANALISIS FAKTOR-FAKTOR TERHADAP UNDERPRICING SAHAM PERDANA

Jurnal Bisnis dan Akuntansi ◽

10.34208/jba.v19i2.277 ◽

2018 ◽

Vol 19 (2) ◽

pp. 251-258

Author(s):

INDRA ARIFIN DJASHAN

Keyword(s):

Multiple Regression ◽

Firm Size ◽

Stock Exchange ◽

Multiple Regression Model ◽

Firm Age ◽

Return On Equity ◽

Price Earnings Ratio ◽

Underwriter Reputation ◽

Equity Ratio ◽

Auditor Reputation

This research aims to determine the effect of firm age, firm size, return on equity, debt to equity ratio, price earnings ratio, auditor reputation and underwriter reputation on the level of underpricing. And to determine which variables are the most dominant effect on the IPO. Underpricing as measured by the initial return is the dependent variable in this research. This research was conducted with the support of the data Indonesia Stock Exchange (IDX), which is the company doing an IPO in 2009 until 2012. Sampling was conducted using a non-probability sample selection method (purposive sampling) resulted in 68 companies as the study sample. Multiple regression model was used to test the relationship between the dependent and independent variables. The results of multiple regression analysis showed that the variables auditor reputation and underwriter reputation on underpricing significantly affect the direction of the negative coefficients for both variables. While variable firm age, firm size, return on equity, debt to equity ratio, price earnings ratio proved to have no significant effect on the occurrence of underpricing.

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Relationship between prestige signals and over-subscription ratio

International Journal of Managerial Finance ◽

10.1108/ijmf-02-2018-0067 ◽

2019 ◽

Vol 15 (4) ◽

pp. 564-579 ◽

Cited By ~ 4

Author(s):

Ali Albada ◽

Othman Yong ◽

Soo-Wah Low

Keyword(s):

Initial Public Offering ◽

Design Methodology ◽

Executive Board ◽

Cross Sectional ◽

Content Type ◽

Underwriter Reputation ◽

Reputational Capital ◽

Public Offering ◽

The Relationship ◽

Institutional Participation

PurposeThe purpose of this paper is to examine whether initial public offering (IPO) over-subscription is a function of firm’s prestige signals conveyed by third parties with reputational capital such as underwriter, auditor and independent non-executive board member.Design/methodology/approachThe relationship between prestige signals and over-subscription ratio (OSR) of IPOs is analysed using a cross-sectional regression based on a sample of 393 IPOs issued between January 2000 and December 2015.FindingsThe results indicate that IPOs underwritten by reputable underwriters have lower OSR than those underwritten by non-reputable underwriters. While issuer engages reputable underwriter to certify firm quality to reduce information asymmetry, the action brings with it lower initial returns for its IPO. Investors interpret the signal conveyed by issuer’s choice of underwriter from under-pricing perspective and respond accordingly by reducing IPO demand. This implies that investors regard under-pricing as a more valuable signal than firm quality signal associated with underwriter reputation. The findings also indicate that over-subscription increases in IPOs that have above average initial returns and higher institutional participation. Issuing firms that go public in a period of high IPO volume are associated with low OSR.Originality/valueThis is the first paper to examine the relationship between the prestige signals and OSR of IPOs in the Malaysian context.

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