AFTERMARKET PERFORMANCE OF IPOs: A REVIEW

Abstract: The primary market of securities and shares play a vital role in the development of an economy. The IPOs act as a platform for new capital inflows for the start-up organizations to enable the growth of an economy. Secondly, they prove to be a systematic mechanism that helps the owners to realize returns for their investments and efforts. The IPOs have been a key source of financing for a longer time, especially in corporate terms. Nevertheless, there have been puzzling scenarios around the pricing of the IPO and it had led to pervasive efficiency in the market. . There have been multiple studies in the market around this premise that examines the IPO's performance. There has been specific focus on the behaviour of the stock in the initial days of listing, short run and long run aftermarket performance of the IPO. This paper is an attempt to summarise the existing research of aftermarket performance of IPOs.

Keywords: ipo pricing, underpricing, aftermarket performance