ARTICLES

ARTICLE 1

TITLE: The hot issue market of Journal of Business

AUTHOR: Ritter

YEAR : 1984

ABSTRACT:

Showed average under pricing of 48.4% over the hot period of 15 months starting from

January 1980 whereas it was 16.3% during the remaining cold period from 1977-82. He

concluded that the most suitable time to issue IPO is when the market is relatively unstable

i.e. immediately after the hot period. Dawson (1987) studied the initial and the long-run

performance of IPOs that were issued from 1978 to 1983 in three different countries i.e.

Hong Kong, Singapore and Malaysia. The study found that IPOs in Malaysia were the most

underpriced at 166.6% as compared to IPOs in Hong-Kong and Singapore where the average

under pricing was found to be 13.8% and 39.4% respectively.

TITLE: Fads in the Initial Public Offering market

AUTHOR: Aggarwal and Rivoli

YEAR : 1990

ABSTRACT:

Related underperformance to a momentary overvaluation of the IPO of issuing firm during

the offer period. The value of the new shares decreases when this over optimism disappears.
ARTICLE 3

TITLE: The long-run performance of Initial Public Offerings

AUTHOR: Ritter

YEAR :1991

ABSTRACT:

Analyzed 1526 IPOs offered in US during 1967-87. He documented that newly listed

companies substantially underperformed a set of seasoned firms matched by size and industry

in stock returns for the first tliree years subsequent to listing. He was the first to document the

long-run underperformance anomaly in IPO literature.

TITLE: NYSE vs. NASDAQ Returns: Market microstructure or the poor

AUTHOR: Loughran

YEAR : 1993

ABSTRACT:

Analyzed the IPO returns with the NASDAQ returns from the period of 1967-1987 for 3556

IPOs and found that the average six year total return of IPOs was 17.29%, whereas it was

76.23% for the NASDAQ index during the same period.

TITLE: Winner's curse, legal liability, and the long-run performance of initial public
offerings in Finland.

AUTHOR: Keloharju

YEAR :1993

ABSTRACT:

Found that the Finnish IPOs lost around 22.4% from the first day of trading to subsequent

three years whereas the market index lost only 1.6%. Underperformance of IPOs was also

confirmed in India. Lee, Taylor and Walter (1996) analyzed initial performance of the IPOs

as well as post-listing returns for IPOs of India firms. The results showed that three years post

to listing. India IPOs performed poorly as compared to the market movements.

TITLE: Investments in IPOs in the Indian Capital Market

AUTHOR: Arwah Arjun Madan

YEAR : 2003

ABSTRACT:

Investments in IPOs in the Indian Capital Market, published in Bimaquest conclude that in

the long run (five-year after listing), there is a drastic fall in the return on IPOs returns;

returns are found to be negative from the second to the fifth year of listing.
ARTICLE 7

TITLE: New Listings – Pied Pipers of Primary Market

AUTHOR: Anand Adhikari

YEAR :2010

ABSTRACT:

New Listings – Pied Pipers of Primary Market published in Business Today point out that

companies with unique business models got listed in the year 2009-10 and made their

investors rich. Atul Mehra (2010) “IPO Boom”, Business Today, point out that promoters are

in hurry to IPO because they do not want to be left out.

TITLE: Price Discovery in Initial Public Offerings and the Role of the Lead Underwriter

AUTHOR: Aggarwal, R.P. Conroy

YEAR :2000

ABSTRACT:

Price Discovery in Initial Public Offerings and the Role of the Lead Underwriter, Journal of

Finance, conclude that the price discovery process of initial public offerings (IPOs) using a

unique dataset. The first quote entered by the lead underwriter in the five-minute preopening

window explains a large proportion of initial returns even for hot IPOs. Significant learning

and price discovery continues to take place during these five minutes with hundreds of quotes

being entered. The lead underwriter observes the quoting behavior of other market makers,

particularly the wholesalers, and accordingly revises his own quotes. There is a strong

positive relationship between initial returns and the time of day when trading starts in an IPO.
ARTICLE 9

TITLE: Stock Price Decision of Indian Investors

AUTHOR: Ansari Abdul Aziz and Jane Samiran

YEAR :2009

ABSTRACT:

Stock Price Decision of Indian Investors, published in The Indian Journal of Commerce

concluded that rational traders are using both fundamental analysis and technical analysis as

stock selection tools, which does not support the view of finance theorist.
ARTICLE 10

TITLE: Changing Contours of Capital flows to India,

AUTHOR: Bhupal Sing

YEAR :2009

ABSTRACT:

Changing Contours of Capital flows to India, published in Economic and Political Weekly,

pointed out that the most striking feature of change in the cross-border capital flows to

emerging market economies during the 1990s is the emergence of portfolio equity inflows. It

was further stated that portfolio investment in India started in 1993 by way of the equity and

debt investment by FIIs in the Indian Stock Markets and Global offerings of ADRs and

GDRs by the Indian Corporate. The FIIs turnover accounts for a significant share of the cash

segment turnover of stocks. The stocks have potential for large volatility in the asset prices.
ARTICLE 11

TITLE: Stabilization, Syndication, and Pricing of IPOs

AUTHOR: Chowdhry, B., V. Nanda

YEAR :2009

ABSTRACT:

Stabilization, Syndication, and Pricing of IPOs, published in Journal of Financial and

Quantitative Analysis point out that in the after-market trading of an IPO, the underwriting

syndicate, by standing ready to buy back shares at the offer price (“price stabilization”),

compensates uninformed investors ex post for the adverse selection cost they face in bidding

for IPOs. This dominates ex ante compensation by underpricing. The reason is that

stabilization exploits ex post information about investor demand whereas underpricing must

be based on ex ante information. However, liquidity and syndication costs constrain the use

of stabilization which, in equilibrium, generates some underpricing as well. We develop a

model that formalizes this intuition and generates several empirical implications.
ARTICLE 12

TITLE: India could herald global IPO recovery

AUTHOR: FE Bureau

YEAR :2009

ABSTRACT:

India could herald global IPO recovery, published by FE Bureau, in The Financial Express

according to the Eanst & Young, Institutional Investor IPO survey, 2009, IPOs in these

emerging markets would show recovery from the economic downturn by the year end. Of the

over 300 institutional investors surveyed, as much as 57% believed India and Brazil are the

most likely to lead the recovery, in terms of new forms entering the local capital market by

the end of 2009. IPO activity in the last two quarters confirms that markets are making an

early recovery, notably in emerging economies of India, China and Brazil. A stable

government and booming sensex has led to the revival of IPO activity.
ARTICLE 13

TITLE: IPOs More Misses Than Hits

AUTHOR: Jagannadham Thunuguntla

YEAR :2011

ABSTRACT:

IPOs published in the Dalal Street Investment pointed out that, the age old philosophy of

understanding the company and sticking to the basics should be given due respect. Let the

buyer be made aware that the investor has to put a price tag to his hard earned money.
ARTICLE 14

TITLE: The Post-Issue Operating Performance of IPO Firms

AUTHOR: Jain, B. A, O. Kini

YEAR :1994

ABSTRACT:

There is a need for investor education and awareness and the connections should be on a

stable income than an becoming rich overnight. Jain, B. A., O. Kini (1994), in their article

“The Post-Issue Operating Performance of IPO Firms”, published in Journal of Finance point

out that the change in operating performance of firms as they make the transition from private

to public ownership. A significant decline in operating performance subsequent to the initial

public offering (IPO) is found. Additionally, there is a significant positive relation between

post-IPO operating performance and equity retention by the original entrepreneurs but no

relation between post-IPO operating performance and the level of initial underpricing.
ARTICLE 15

TITLE: Venture Capitalist Participation and the Post-Issue Operating Performance of IPO
Firms

AUTHOR: Jain, B. A., O. Kini

YEAR :1995

ABSTRACT:

Managerial Decision Economics mention that by comparing the post-issue operating

performance of venture capitalist-backed IPOs with a matched sample of non-venture

capitalist-backed IPOs. We find that venture capitalist-backed IPO firms exhibit relatively

superior post-issue operating performance compared to non-venture capitalbacked IPO firms.

Further, the market appears to recognize the value of monitoring by venture capitalists as

reflected in the higher valuations at the time of the IPO. Finally, we find that proxies for the

quality of venture capitalist monitoring are positively related to post-issue operating

performance.
ARTICLE 16

TITLE: The Stock Market – Theories and Evidence

AUTHOR: James H. Lorie, Peter Dodd and Mary Hamilton, Kimpton

YEAR :1997

ABSTRACT:

IFCAI Publication, Hyderabad, pointed out that the value of a corporations stock is

determined by expectations regarding future earnings of the corporation and by the rate at

which those earnings are discounted. In a world of no uncertainty, all securities would offer a

certain return equal to the real rate of return in capital.

TITLE: Contemporary Finance Digest summaries that Companies going public

AUTHOR: Jay R. Ritter

YEAR :1998

ABSTRACT:

Contemporary Finance Digest summaries that Companies going public, especially young

companies, face a market that is subject to sharp swings in valuations. Pricing deals can be

difficult, even in stable market conditions, because insiders presumably have more

information than potential outside investors. To deal with these potential problems, market

participants and regulators insist on the disclosure of material information.

TITLE: IPO is an Indian Primary Market

AUTHOR: K. C. John Sasi Kumar

YEAR :1986

ABSTRACT:

A Review published in International Journal of Contemporary Business Studies, concluded

that the performance of IPO’s has been cheering to the investors. Retail investors can go for

the IPO market for safe and secured investment. Even though the recent economic

development has slowed the process of IPO issue we could expect speedy recovery of both

the economy and IPO activities. Madhumita Gosh, Vice President (PM & Research) Unicon

Financial Intermediaries in her article “IPOs: More Misses Than Hits”, published in the Dalal

Street Investment Journal, pointed out that, in the recent past a majority of IPOs haven’t

performed well because valuation wise they are priced more than the fundamentals. This has

happened mainly due to the greed of promoters, who want to price their issue invariably at a

much higher price. In such cases merchant bankers’ role also comes under scanner as they

usually don’t give proper advice to the promoters in the wake of losing the business.
ARTICLE 19

TITLE: Primary Concerns of IPO

AUTHOR: Mahesh Nayak

YEAR :2010

ABSTRACT:

In the Business world, point out that, IPOs have grown in size and entered their own brave

new world. Further he states that raising money in India’s booming economy cannot be a

onetime affair; if a company does not maintain a good relationships with investors and

rewards them well it may not able to go back to them when it want to raise money later.
ARTICLE 20

TITLE: Free Pricing of Equity - The Indian Experience

AUTHOR: Minakshi Malhotra

YEAR :1997

ABSTRACT:

The Journal of Accounting and Finance Spring, 1997 pointed out that the period immediately

after the introduction of free pricing witnessed charging of very high premium over par

values and as compared to what would have been suggested by CCI. The majority of the

issues failed to qualify the market test of performance as is revealed by the price behaviour of

premium issues after a lapse of six months.