Stock Exchange Review Inquiry And IPO Underpricing

Under the background of the registration system pilot implementation,the Science and Innovation Board came into being.Besides the listing threshold of the Science and Innovation Board is different from other boards,another important feature of the board is that the enterprises listed in the board,without exception,need to go through multiple rounds of inquiry and reply process before they can register with China Securities Regulatory Commission.The original intention of the Shanghai Stock Exchange to set up the examination and inquiry system in the Science and Technology Innovation Board is to urge enterprises to disclose more information,so as to reduce the information asymmetry and improve the performance of the IPO market.But companies are cautious about information disclosure,and multiple rounds of complicated inquiries may not achieve the desired results.This paper selects the data of the Science and Innovation Board from 2019 to2021 to investigate the impact of the audit inquiry on the underpricing rate of new ipos from the intensity and content of the audit inquiry.After the full sample regression analysis,it is found that the higher the exchange audit and inquiry intensity,the higher IPO underpricing rate;The more inquiries related to corporate financial information,the higher IPO underpricing rate;The intonation of inquiry response letter has no significant effect on IPO underpricing rate.The heterogeneity of the samples is further tested,and it is found that for enterprises with low R&D investment and low institutional shareholding ratio,the increase of audit and inquiry intensity is more likely to increase the IPO underpricing rate,which reduces the IPO pricing efficiency.In the further study,this paper examines the impact of the audit inquiry on the stock market performance after IPO,and finds that the stronger the audit intensity of the inquiry,the worse the stock market performance after IPO.The more inquiries about core technical information,the worse the stock market performance after IPO;Similarly,no significant relationship was found between response tone and market performance after IPO.Combined with the research conclusion,this paper respectively from the stock exchange,underwriter,participating in the inquiry of institutional investors and secondary market investors four market players to put forward relevant suggestions.The stock exchange can reduce unnecessary inquiry procedures and improve the efficiency of audit inquiry.The underwriter should carefully interpret the information in the prospectus and put forward a reasonable inquiry range;Institutional investors should pay attention to the information disclosed in the process of inquiry and interpret it objectively,so as to make the offer more in line with the enterprise value.Secondary market investors should maintain a rational investment attitude,not blindly follow the trend.