An Analysis On Factors Affecting The IPO Under-pricing In China's A-Share Market

The problem of IPO under-pricing exists in global new stock markets universally. So far it is still 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. With the attention to the development of Chinese stock market, the article tries to find the reasons of the problem from the factors of government, enterprises, invest-bank and investor, and propound suggestions to decrease IPO under-pricing rate.First, this article gives a brief introduction of the background, the significance, the aim, the framework, the research method and the thinking clew of this paper. Then there is a summary of the theories about the IPO under-pricing. Second, the article makes a detailed comparison between every pricing model, and does a comparative analysis on the way of IPO pricing of domestic enterprises. Then, the article makes a specific analysis on the influence factors of IPO under-pricing from four aspects: government, enterprises, invest-banks and investors. On the foundation of theoretical researches, the article makes a multi-factor regression model to do systemic empirical researches on factors affecting the under-pricing of IPO. The data used in this model covers the period from Dec.1996 to Mar.2007 with the samples including 109 companies.At last, according to the theoretical analysis and empirical researches, the paper offers the suggestions on the IPO pricing policy.