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Intended use of IPO proceeds and firm performance: A quantile regression approach

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  • Andriansyah, Andriansyah
  • Messinis, George

Abstract

This paper employs quantile regressions to investigate the link between the intended use of proceeds and the post-issue operating performance of IPO firms in Indonesia over the period of 2000-2010. The evidence presented here suggests that post-issue performance can be explained by a firm’s motivation to IPO issues. Investment in fixed assets and stock market shares associate with better performance for average and high-performing firms while other usages seem to lead to poor performance. The findings are robust when ownership structure was considered. These results have policy implications for the management of IPOs.

Suggested Citation

  • Andriansyah, Andriansyah & Messinis, George, 2016. "Intended use of IPO proceeds and firm performance: A quantile regression approach," MPRA Paper 116697, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:116697
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    Cited by:

    1. Fan, Pengda, 2019. "Debt retirement at IPO and firm growth," Journal of Economics and Business, Elsevier, vol. 101(C), pages 1-16.
    2. Andriansyah, Andriansyah, 2016. "Savings and Investment in Indonesia," MPRA Paper 105254, University Library of Munich, Germany.
    3. Andriansyah, Andriansyah, 2017. "The Real Effect of Primary and Secondary Equity Markets on Firm Performance: Evidence from Indonesia," MPRA Paper 116696, University Library of Munich, Germany.
    4. Udo Broll & Soumyatanu Mukherjee & Rudra Sensarma, 2020. "Risk preferences estimation of exporting firms under exchange rate uncertainty," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(1), pages 126-136, February.
    5. Amor, Salma Ben & Kooli, Maher, 2017. "Intended use of proceeds and post-IPO performance," The Quarterly Review of Economics and Finance, Elsevier, vol. 65(C), pages 168-181.
    6. Nugroho Sasikirono & Sumiati Sumiati & Nur Khusniyah Indrawati, 2018. "Underpricing and long-term market performance of initial public offerings in Indonesia: A quantile regression approach," Business and Economic Horizons (BEH), Prague Development Center, vol. 14(1), pages 152-167, January.

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    More about this item

    Keywords

    IPO intentions; firm performance; compositional data; quantile regressions; Indonesia;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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