| dc.description.abstract | An initial public offering or Initial Public Offering (IPO) is one of the ways to attract financial resources not only in foreign but also in domestic markets. There are several phenomena associated with an initial public offering such as initial underpricing, reduced long-term profitability and, cyclical placements. Research on the effectiveness of initial public offerings is a relevant topic since this method is one of the most common ways to attract capital for companies.
This Master`s thesis analyzes the existing research on the topic put forward to study the effectiveness of initial public offerings by Norwegian companies listed on the Oslo Stock Exchange.
Hypotheses were put forward on the influence of firm-specific, offer-specific and, market-specific factors on the initial underpricing and return in the short-term, medium-term and, long-term periods. To investigate this, a graphical analysis was carried out for a full sample of Norwegian companies and a sub-sample of companies divided into sectors. Graphical analysis was also used to determine the cyclicality of the initial public offerings on the Oslo Stock Exchange.
To characterize the influence of the above factors on the return, an empirical analysis was carried out. In the analysis, the dependent variable was a return at different times after the IPO. In total, 6 regression models were built, including returns from the first day to 1 year after the initial public offering.
In the course of the work, the phenomenon of underpricing of initial public offerings was proved, as well as the cyclical nature of offers on the Norwegian market. However, it has been shown that the initial underpricing of shares on the Norwegian market is much lower than the average underpricing on other markets. In addition, it was rejected that the underpricing of high-tech companies is higher than in other sectors. The signs indicating long-term underperformance were found, but not fully proved. The influence of various factors on the return at different time intervals after the companies entered the stock exchange was studied and analyzed. The results obtained confirm the theories of information asymmetry and once again prove the existence of phenomena associated with the initial public offering. | |
