The Performance and Long-Run Characteristics of the Chinese IPO Market

19 Pages Posted: 7 Jan 2006

See all articles by Carol Padgett

Carol Padgett

University of Reading - ICMA Centre

Jing Chi

Massey University - School of Economics and Finance

Multiple version iconThere are 2 versions of this paper

Abstract

We study the short-run and long-run performance of 340 and 409 IPOs, respectively, listed on China's two exchanges from 1996 to 1997. We find that the average underpricing is 127.3%, and that the average market-adjusted cumulative return and buy-and-hold return over the three years after listing are 10.3% and 10.7%, respectively, which are both significantly positive at the 5% level. We then use a cross-sectional analysis to explain the long-run out-performance of Chinese IPOs, and find that firms with lower government ownership, smaller offering sizes, high-tech features and lower initial returns perform better in the long-run.

Suggested Citation

Padgett, Carol and Chi, Jing, The Performance and Long-Run Characteristics of the Chinese IPO Market. Pacific Economic Review, Vol. 10, No. 4, pp. 451-469, December 2005. Available at SSRN: https://ssrn.com/abstract=871270 or http://dx.doi.org/10.1111/j.1468-0106.2005.00285.x

Carol Padgett

University of Reading - ICMA Centre ( email )

Whiteknights Park
P.O. Box 242
Reading RG6 6BA
United Kingdom

Jing Chi (Contact Author)

Massey University - School of Economics and Finance ( email )

Private Bag 11-222
Palmerston North,, 4442
New Zealand
+64 6 3569099 Ext. 84048 (Phone)
+64 6 350 5651 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
20
Abstract Views
1,123
PlumX Metrics