Market Efficiency on the Stock Price of Taiwan's Initial Public Offering Company–Sample Companies Selected after Taiwan's New 2005 IPO rules

• Main Authors: Yung-chang Yang, 楊永昌
• Other Authors: Kuang-Wen Chang
• Format: Others
• Language: zh-TW
• Published: 2007
• Online Access: http://ndltd.ncl.edu.tw/handle/56684060026562665917

碩士 === 東吳大學 === 企業管理學系 === 95 === Taiwan’s Security and Future Bureau enabled the new initial public offering (IPO) company’s stock pricing rules on January 1st, 2005. This paper is the first empirical study to examine whether the new rules are more efficient than the old IPO pricing rules. This study’s objective is to analyze the influencing reasons on IPO stock pricing. From the influencing reasons aspect, this research considers four factors: corporate governance, financial factor, issuance terms, and market factor. From the IPO pricing methods consideration, this study compares five methods: the IPO pre-setting price, the 30 day average price in Taiwan’s emerging market, and the reference pricing market method, the cost method, and the discounted cash flow method. This study’s samples 52 IPO companies listed in Taiwan’s stock market from January 1st, 2005 to December 31st, 2006. The empirical results conclude that the most important reason influences both IPO pricing adjustment and initial raw return is the market factor. In addition, the emerging market 30 day average price is the best pricing method among this study’s five pricing methods in predicting the final IPO market price. Finally, IPO company’s listed price in the 5th days is higher than the first day listed price. This result indicates that in order to receive a positive raw return, IPO company’s first day stock price should be less than its current price in Taiwan’s emerging stock market.