Empirical Analysis Of Underpricing Factors Of The IPO After The Settlement Of Split Share Structure

IPO's underpricing refers to that the initial price is lower to the first - day market closing price, which brings the excess return on the first day of the offerings. The problem of IPO under-pricing exists in global new stock markets universally. So far it still was a puzzle of the kingdom of finance. Many native and foreign scholars have started from many different theories and positive methods to explain this phenomenon.Chinese IPO's underpricing reveals two characteristics :Firstly it is much more severe than those of other countries'. Secondly it has been declined since years, but still remains relatively high. Based on 56 equities, which were issued in our country from 2006 to 2007, after the settlement of Split Share Structure and the Inquiry System, a model is built with 9 factors that affected the excess return as variable in modem econometrics method. Our model shows that the settlement of Split Share Structure will avail the decline of Chinese IPO 's underpricing and improve the efficiency of Chinese IPO markets.