Study On The Influence Of New Issue System To IPO Underpricing In China

IPO underpricing is a common phenomenon in capitalist market, and the degree of IPO underpricing differs in different countries and regions. Generally speaking, the degree of IPO underpricing in mature capitalist market in developed countries and regions is relatively lower than that in undeveloped countries and regions. China, especially, is called the highest IPO underpricing in the world.The reason why the degree of IPO underpricing is highest is that China’s capitalist market is established relatively late and not mature enough; the principal contradiction of mismatch between supply and demand in capitalist market is not solved; and may be closely related to the imperfect capitalist market mechanism of China and the frequent and tumultuous changes of new issue system. This paper, on basis of the research achievement at home and abroad, aims to explore the influence of new issue system to IPO underpricing through the presentation of high IPO underpricing based on the new issue system reform of China by comparing the differences of gap of the development of capitalist market and new issue system at home and abroad.The new issue system includes auditing system, launch way and pricing mechanism. These three aspects are explored respectively based on theoretical analysis. This paper discusses that the main factor causing high IPO underpricing is the deficiency of new issue system, and the principal contradiction of mismatch between supply and demand in China’s capitalist market remains unsolved. On the theoretical analysis, this paper collects and classifies representative data samples before or after new issue system reform, preliminarily descriptively and statistically analyzes auditing system, launch way, pricing mechanism and the other factors might be related to IPO underpricing by principle of statistics on the basis of professional knowledge, establishes multiple linear regression model and analyzes the relevant factors regressively by spss software.The empirical analysis demonstrates that the new issue system can produce significant effect to IPO underpricing and institutional deficiency is key factor of causing high IPO underpricing in China, especially approval system and authorized system with strong administrative color and irregularity. Meantime, the process of new issue system reform is consistent with the reduction of the degree of IPO underpricing, which shows that the capitalist market in China is gradually perfect and catches up with internationalization and marketization. With the transition of issue system reform to registered system, this change will continue and be close to IPO pricing in abroad stock market.At last, this paper suggests resisting the marketization-orientation reform of IPO issue system, deepening the strength of reform, gradually transiting the auditing system to registered system smoothly, perfecting inquiry system, cultivating market mechanism, standardizing the management and supervision of IPO market and aggrandizing intensity in execution of systems.