Research On IPO Pricing Of The Listed Companies Under The Registration System Of Science And Technology Innovation Board

Under the registration system of the Science and Technology Innovation Board(STAR market),a key step has been taken in the marketization reform of the issuing and pricing system of China’s securities market.However,since launch of the STAR market,the IPO price of the primary market has repeatedly reached new highs,even exceeding the secondary market valuation of comparable listed companies,and the "Breaking Issue" has frequently occurred.Is the IPO pricing reasonable?Firstly,this paper takes the IPO data of listed companies,from the opening of the science and technology innovation board in 2019 to the end of 2020,as the research sample to test the rationality of IPO pricing.The number of various variables representing the intrinsic value is decreased by using the principal component analysis,and the principal component factors are extracted.Then,an empirical model of IPO pricing is constructed based on the stochastic frontier approach.The result shows that:as the first board to implement the registration system in A-share,most of the listed companies are high-tech innovative companies,and the IPO pricing is generally overvalued,with an average deviation of 33.50%from the intrinsic value.On this basis,this paper further studies the influence of location feature and underwriter feature on the IPO pricing.The results show that:investors have more confidence in those companies,whose registered address are located in the first tier cities of "Beijing,Shanghai,Guangzhou and Shenzhen",or the main underwriter are high reputation investment banks,and the IPO pricing of these companies is more overvalued than other companies.This paper also finds that investors pay less attention to the growth ability index of these companies,and the short-term performance change will not have a significant impact on investors’ judgment.This study shows that China’s market-oriented issuing and pricing system still needs to be more mature,and market investors still have a lot of irrational investment.This paper makes some recommendations according to the research results,such as strengthening the underwriter’s responsibility,improving the information disclosure system,and advocating investors to participate in the market rationally.