Proceedings of the 2023 International Conference on Finance, Trade and Business Management (FTBM 2023)

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Venture Capital and First-Month IPO Underpricing Rate: An Empirical Study Based on the Up and Down Limits of China GEM

Authors
Xuwei Jiang1, *
1Finance Management School, Shanghai University of International Business and Economics, Shanghai, 201620, China
*Corresponding author. Email: 20080013@suibe.edu.cn
Corresponding Author
Xuwei Jiang
Available Online 30 November 2023.
DOI
10.2991/978-94-6463-298-9_30How to use a DOI?
Keywords
venture capital; IPO underpricing; syndication; information asymmetry
Abstract

Under the limit of upward and downward movement, the closing price of IPO on the first day often fails to reflect the real price of IPO companies, while VC can have an impact on the pricing of IPO companies by alleviating the asymmetry of market information; this paper, in the background of China's Growth Enterprise Market (GEM) upward and downward movement limit, conducts empirical research on venture capital and the first-month IPO underpricing rate, and uses the PSM to carry out a robustness test on the regression results, and the research shows that: 1) there is a significant negative correlation between the existence of VC in the GEM IPO firms and the first-month IPO underpricing rate; 2) venture capital syndication insignificantly increases the first-month IPO underpricing rate, and there exists a degree of grandstanding motivation to help companies go public more easily by reducing the IPO offering price, or from a market perspective, investors are more favourable to IPO companies where syndication exists, leading to a higher first-month IPO underpricing rate.

Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2023 International Conference on Finance, Trade and Business Management (FTBM 2023)
Series
Advances in Economics, Business and Management Research
Publication Date
30 November 2023
ISBN
10.2991/978-94-6463-298-9_30
ISSN
2352-5428
DOI
10.2991/978-94-6463-298-9_30How to use a DOI?
Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Xuwei Jiang
PY  - 2023
DA  - 2023/11/30
TI  - Venture Capital and First-Month IPO Underpricing Rate: An Empirical Study Based on the Up and Down Limits of China GEM
BT  - Proceedings of the 2023 International Conference on Finance, Trade and Business Management (FTBM 2023)
PB  - Atlantis Press
SP  - 271
EP  - 278
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-298-9_30
DO  - 10.2991/978-94-6463-298-9_30
ID  - Jiang2023
ER  -