Malaysian IPO performances: the effect of growth opportunities and public issue / Siti Suhaila Abdul Rahman

Abdul Rahman, Siti Suhaila (2020) Malaysian IPO performances: the effect of growth opportunities and public issue / Siti Suhaila Abdul Rahman. Masters thesis, Universiti Teknologi MARA.

Abstract

This study examines the influence of growth opportunity of a firm on IPO
performance in the immediate and long-term aftermarket. This study also
examines the interaction effect of IPO issued through public issue type on the
relationship between growth opportunity of a firm and IPO performance. The
declining pattern on the mean initial returns and the negative long-term
aftermarket returns of Malaysian IPOs alarmed investors to wisely choose IPO
firms for them to participate and produce their desirable returns. This study
proposes that growth opportunity of a firm should significantly and positively
influence the immediate aftermarket and long-term aftermarket performance of
IPOs as such potentially assist investors to achieve for their desired profits.
Therefore, this study is conducted to achieve for the following objectives: 1) To
investigate the influence of growth opportunities of firms on the immediate
aftermarket performance of IPOs ; 2) To investigate the influence of growth
opportunities of firms on the long-term aftermarket performance of IPOs; 3) To
investigate the interacting effect of public issues on the main relationship
between growth opportunities of firms and both immediate aftermarket and
long-term aftermarket performance of IPOs; 4) To investigate the influence of
other independents variables (e.g., demand of IPOs, offer size, underwriter
reputation, firm size and market condition) on IPO performance in both
immediate and long-term aftermarket. This study employs cross-sectional
multiple regression models to test for all of its hypotheses. Employing 403 IPOs
listed in Main Market and ACE Market of Bursa Malaysia from January 2000 to
December 2014, this study reveals that growth opportunity of a firm that is
measured by the percentage of IPO proceeds allocated to growth activities has a
positive and significant relationship to IPO performance in both the immediate
and long-term aftermarket. Moreover, despite the insignificant interaction effect
of public issue ratio on the relationship between growth opportunity of a firm
and IPO performance in both periods, this study reveals that the interaction
product between growth opportunity of a firm and public issue ratio strengthens
the influence of growth opportunities of firms on performance of IPOs.

Metadata

Item Type: Thesis (Masters)
Creators:
Creators
Email / ID Num.
Abdul Rahman, Siti Suhaila
2017847014
Contributors:
Contribution
Name
Email / ID Num.
Thesis advisor
Che Yahya, Norliza (Dr.)
UNSPECIFIED
Subjects: H Social Sciences > HG Finance > Investment, capital formation, speculation
Divisions: Universiti Teknologi MARA, Shah Alam > Faculty of Business and Management
Programme: Master of Science in Business Management
Date: April 2020
URI: https://ir.uitm.edu.my/id/eprint/60040
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