Underwriter reputation and the underwriter–investor relationship in IPO markets
Neupane, Suman and Thapa, Chandra (2013) Underwriter reputation and the underwriter–investor relationship in IPO markets. Journal of International Financial Markets Institutions and Money, 24. pp. 105-126. ISSN 1042-4431 (https://doi.org/10.1016/j.intfin.2012.11.005)
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Using data from the unique setting of Indian IPOs, this study examines the underwriter–investor relationship based on underwriter reputation. We find that high reputation and low reputation underwriters have strong relationships with different sets of investors. While large institutional investors participate early in IPOs managed by high reputation underwriters, high net worth investors appear to do the same in IPOs managed by low reputation underwriters. The varying nature of relationships with investors also has important consequences for IPO pricing. Our analysis of the setting of the offer price shows that reputation matters greatly for high reputation underwriters. Low reputation underwriters, on the other hand, appear to price aggressively and set high offer prices even when institutional participation is negligible.
ORCID iDs
Neupane, Suman and Thapa, Chandra ORCID: https://orcid.org/0000-0001-8661-8079;-
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Item type: Article ID code: 43766 Dates: DateEventApril 2013PublishedSubjects: Social Sciences > Finance Department: Strathclyde Business School > Accounting and Finance Depositing user: Pure Administrator Date deposited: 09 May 2013 12:53 Last modified: 24 Nov 2024 12:08 URI: https://strathprints.strath.ac.uk/id/eprint/43766