An Study On The Initial Public Offering Underpricing In China SME Stock Market

Initial public offering underpricing is a world-wide phenomenon, but especially serious in China. Some Chinese scholars have done studies on Chinese stock market on the basis of western theories, but they neglest the equity separation system. This paper conducts an empirial study after the reform of equity separation while still on the basis of western theories to find out the special and unique factors that influencing IPO excess returns in the Chinese stock market.To achieve its goal, this paper applies both quantitative analysis and qualitative analysis. Firstly, the paper related literature on the IPO underpricing, summarizes the recent empirical results in China and other countries. Secondly, this paper studies the main procedure of IPO, analyses and summarizes orientian, fuction, establishment, the present developing and future trend of main overseas growth enterprise markets and SME board. And then, this paper reviews the theories of IPO underpricing in recent years, and makes an empirial study on SME Board. The study indicates that there is an excess rate of return on SME Board. Some of SSE Guidelins have the positive effect on the development of SME Board. Finanlly, the conclusion is drawn, the suggestions are given and the limitation are postulated.The follow are the main conclusions in this dissertation: the study indicates that there is an excess rate of return on SME Board, the this paper finds out that the research and explanation of western scholars is not very helpful to understand the underpricing phenomenon in China. Instead it concludes that some of the special and unique factors affect the IPO underpricing in China. Chinese stock market IPO underpricing may has its unique reasons, and it is better to solve these problems to push IPO underpricing into a reasonable extent.