IPO trends and factors that affect IPO decisions for Chinese companies during last 10 years

Abstract

With the development of Chinese Economic, more and more Chinese companies are willing to go public. The reasons that support those companies to go list vary from companies to companies. The most important of them are generating money for companies’ expansion and increasing the reputation among the industry and its customers. Listing location is an essential ingredient for the success of the IPO. Different listing locations have different listing requirements. For example, the they may have specific requirements on the profit and market capitalization on companies. What’s more, the company can choose the most suitable location for its situation and strategy. This research copes with the factors affect the IPO valuation for Chinese companies during the last ten years. Multiple regression has been used to investigate the impact of companies’ financial ratios on stock prices. By comparing the P-value of variables, I propose that the companies’ Return on Equity will have a positive impact on the stock prices. In addition, the research also tries to find the factors that affect the increase of IPO volume for Chinese companies. However, unfortunately, the increase percent of IPO volume for Chinese companies cannot be credit to the Interest rate and GDP growth rate.