IDEAS home Printed from https://ideas.repec.org/a/mes/chinec/v48y2015i2p87-113.html
   My bibliography  Save this article

IPO Performance on China’s Newest Stock Market (ChiNext)

Author

Listed:
  • Hamish Anderson
  • Jing Chi
  • Qing (Sophie) Wang

Abstract

We study IPO underpricing and long-run performance of ChiNext, a newly-established Growth Enterprise Board in China. Using a sample of 281 ChiNext IPOs during October 2009–December 2011, we find the initial average market adjusted abnormal return (MAAR) is 33.5 percent. The average 12-month buy-and-hold abnormal return (BHAR) is −45.7 percent for those IPOs listed prior to 2011. Although the average MAARs of ChiNext is significantly higher than IPOs listed on the Main Board, it is not significantly different from the Small and Medium Enterprise (SME) Board IPOs during the sample period. However, the ChiNext average BHARs are significantly lower than those on both the SME and Main Boards. Regression findings support the information asymmetry hypothesis (high uncertainty of ChiNext IPOs) and the behavioral theory (market sentiment) on underpricing for ChiNext IPOs, and we find that ChiNext IPO underperformances are consistent with the significant deterioration of their operating performance after listing and investors’ speculative trading behavior on these new issues.

Suggested Citation

  • Hamish Anderson & Jing Chi & Qing (Sophie) Wang, 2015. "IPO Performance on China’s Newest Stock Market (ChiNext)," Chinese Economy, Taylor & Francis Journals, vol. 48(2), pages 87-113, March.
    • Handle: RePEc:mes:chinec:v:48:y:2015:i:2:p:87-113
    DOI: 10.1080/10971475.2015.993215
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/10971475.2015.993215
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/10971475.2015.993215?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wang, Qing (Sophie) & Anderson, Hamish & Chi, Jing, 2018. "VC political connections and IPO earnings management," Emerging Markets Review, Elsevier, vol. 35(C), pages 148-163.
    2. Nischay Arora & Balwinder Singh, 2019. "Impact of Auditor and Underwriter Reputation on Underpricing of SME IPOs in India," Management and Labour Studies, XLRI Jamshedpur, School of Business Management & Human Resources, vol. 44(2), pages 193-208, May.
    3. Nischay Arora & Balwinder Singh, 2024. "Do Prestigious Underwriters Shape the Performance of SME IPOs in India?," Global Business Review, International Management Institute, vol. 25(3), pages 632-655, June.
    4. Rathnayake, Dilesha Nawadali & Louembé, Pierre Axel & Kassi, Diby François & Sun, Gang & Ning, Ding, 2019. "Are IPOs underpriced or overpriced? Evidence from an emerging market," Research in International Business and Finance, Elsevier, vol. 50(C), pages 171-190.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mes:chinec:v:48:y:2015:i:2:p:87-113. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/MCES20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.