IPO Underpricing and Predictive Power of Board Related Corporate Governance Mechanisms: A Study of Indian IPO Market - Theoretical Economics Letters

TEL > Vol.9 No.6, August 2019

Theoretical Economics Letters

Volume 9, Issue 6 (August 2019)

ISSN Print: 2162-2078 ISSN Online: 2162-2086

Google-based Impact Factor: 1.19 Citations h5-index & Ranking

IPO Underpricing and Predictive Power of Board Related Corporate Governance Mechanisms: A Study of Indian IPO Market ()

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DOI: 10.4236/tel.2019.96127 837 Downloads 2,707 Views Citations

Author(s)

Amit Kumar Singh¹, Sheetal Maurya¹, Amiya Kumar Mohapatra²

Affiliation(s)

¹Department of Commerce, Delhi School of Economics, University of Delhi, New Delhi, India.
²Fortune Institute of International Business (FIIB), New Delhi, India.

ABSTRACT

Role of corporate governance indicators in IPO (Initial Public Offering) pricing is moderately researched area, however, a majority of these researches are found to be in context of other than Asian economies. Particularly, in context of Indian IPO market, only a few studies have been conducted in the past. Hence, the present study aspires to bridge this gap by examining the statistical significance of board-related corporate governance mechanisms in predicting the likelihood of IPO underpricing. This study is unique as it incorporates a new dimension of “board leadership” and examines the impact of having an independent director as the chairman of the board on IPO underpricing. Binary Logistic Regression Model is used to establish the relationship between IPO Listing gain/loss and board-related corporate governance mechanisms viz. participation of women directors on board, nature of board leadership and board independence.

KEYWORDS

Corporate Governance, IPO Underpricing, Board Independence, Board Leadership, Gender Diversity on Board, Informational Asymmetry, Signalling Theory

Share and Cite:

Singh, A. , Maurya, S. and Mohapatra, A. (2019) IPO Underpricing and Predictive Power of Board Related Corporate Governance Mechanisms: A Study of Indian IPO Market. Theoretical Economics Letters, 9, 2002-2018. doi: 10.4236/tel.2019.96127.

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