Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns

This study examines a sample of 228 companies that went public in the Malaysian Stock Exchange known as Bursa Malaysia. This study intends to find whether the Reputations of Auditors’ and Underwriters’ have an effect on IPOs initial returns. Companies considering initiating public offerings (IPO) ex...

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Main Author:	Mohamed Afzal Khan, Mohamed Aslam Khan
Format:	Thesis
Published:	2014
Subjects:	HG Finance
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id	my-mmu-ep.5664
record_format	uketd_dc
spelling	my-mmu-ep.56642015-06-30T04:20:44Z Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns 2014-06 Mohamed Afzal Khan, Mohamed Aslam Khan HG Finance HG4001-4285 Finance management. Business finance. This study examines a sample of 228 companies that went public in the Malaysian Stock Exchange known as Bursa Malaysia. This study intends to find whether the Reputations of Auditors’ and Underwriters’ have an effect on IPOs initial returns. Companies considering initiating public offerings (IPO) expect to raise funds and would like to maximize their initial return. The asymmetry of information between parties involved in initial public offerings often jeopardizes potential investors’ involvement. Besides Auditors’ and Underwriters’ reputation, other factors such as Market Condition, Firm Age and Firm Size also have a significant impact on IPOs’ initial returns. Therefore this study have included these factors as control variables. The findings reveal a number of significant relationships, some of which are opposite to the prediction. The results shows that the higher the reputation of the underwriter the lower the initial return. Whereas Auditors’ reputation is positively significant which states that the higher the reputation of Auditors’ the higher the initial return. The reason for this opposite direction is in line with the signaling hypothesis. This study can be a contribution to provide knowledge to Malaysian companies who are considering to initiate public offerings. Furthermore, this study is also useful for further research, and is expected to be additional material and references for subsequent studies of its kind. 2014-06 Thesis http://shdl.mmu.edu.my/5664/ http://library.mmu.edu.my/diglib/onlinedb/dig_lib.php masters Multimedia University Graduate School of Management
institution	Multimedia University
collection	MMU Institutional Repository
topic	HG Finance HG Finance
spellingShingle	HG Finance HG Finance Mohamed Afzal Khan, Mohamed Aslam Khan Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns
description	This study examines a sample of 228 companies that went public in the Malaysian Stock Exchange known as Bursa Malaysia. This study intends to find whether the Reputations of Auditors’ and Underwriters’ have an effect on IPOs initial returns. Companies considering initiating public offerings (IPO) expect to raise funds and would like to maximize their initial return. The asymmetry of information between parties involved in initial public offerings often jeopardizes potential investors’ involvement. Besides Auditors’ and Underwriters’ reputation, other factors such as Market Condition, Firm Age and Firm Size also have a significant impact on IPOs’ initial returns. Therefore this study have included these factors as control variables. The findings reveal a number of significant relationships, some of which are opposite to the prediction. The results shows that the higher the reputation of the underwriter the lower the initial return. Whereas Auditors’ reputation is positively significant which states that the higher the reputation of Auditors’ the higher the initial return. The reason for this opposite direction is in line with the signaling hypothesis. This study can be a contribution to provide knowledge to Malaysian companies who are considering to initiate public offerings. Furthermore, this study is also useful for further research, and is expected to be additional material and references for subsequent studies of its kind.
format	Thesis
qualification_level	Master's degree
author	Mohamed Afzal Khan, Mohamed Aslam Khan
author_facet	Mohamed Afzal Khan, Mohamed Aslam Khan
author_sort	Mohamed Afzal Khan, Mohamed Aslam Khan
title	Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns
title_short	Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns
title_full	Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns
title_fullStr	Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns
title_full_unstemmed	Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns
title_sort	signalling role of underwriters and auditors on initial public offerings’ (ipos’) initial returns
granting_institution	Multimedia University
granting_department	Graduate School of Management
publishDate	2014
_version_	1747829582893940736

Signalling role of underwriters and auditors on Initial Public Offerings’ (IPOs’) initial returns

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