A study of IPO listing returns in National Stock Exchange
by Rajkumar Sharma; Amit Chaudhary; Navneet Gera
International Journal of Financial Markets and Derivatives (IJFMD), Vol. 7, No. 3, 2020

Abstract: The goal of this study is to analyse the IPO listing returns in National Stock Exchange (NSE) and provide insights for retail investors study has considered a sample of 463 IPOs listed in NSE from January 2000 to August 2018. Mean listing return has been found to be 20.10% which is abnormally high as compared to mean market return which is 0.24. Out of 463 IPOs 66.74% IPOs gave positive listing returns which means these IPOs were underpriced. But we cannot generalise that all IPOs are underpriced because 33.26% IPOs were overpriced and gave negative listing returns. This study provides a base for retail investor to formulate investment strategy. This study shows that by subscribing for all IPOs (over a period of 18 years) and selling them on listing day, a retail investor could have earned about 99% more returns as compared to market return and savings bank account return.

Online publication date: Tue, 01-Sep-2020

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