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Did the COVID-19 pandemic (really) positively impact the IPO Market? An Analysis of information uncertainty

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  • Baig, Ahmed S.
  • Chen, Mengxi

Abstract

Anecdotal evidence seems to suggest that the initial public offering (IPO) market performed remarkably well through the COVID-19 pandemic. To further understand this peculiar observation, we carry out a comprehensive analysis of IPOs during the pandemic vis-a-vis IPOs before the pandemic. Our findings imply that IPOs during the pandemic experience greater information uncertainty compared to those before the pandemic, and this greater uncertainty is mainly driven by the IPOs from the high-technology and the healthcare sectors. Furthermore, we find that an average IPO firm experiences larger underpricing and more post-IPO return volatility as the pandemic and the associated government responses increase in severity before the offering. Overall, our study indicates that the COVID-19 pandemic had an adverse impact on the IPO market.

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  • Baig, Ahmed S. & Chen, Mengxi, 2022. "Did the COVID-19 pandemic (really) positively impact the IPO Market? An Analysis of information uncertainty," Finance Research Letters, Elsevier, vol. 46(PB).
    • Handle: RePEc:eee:finlet:v:46:y:2022:i:pb:s1544612321003743
    DOI: 10.1016/j.frl.2021.102372
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    4. Sofia Terlica & António Galvão & Nuno Nunes, 2026. "Initial Public Offerings: context, trends, and regulation," Economic Bulletin and Financial Stability Report Articles and Banco de Portugal Economic Studies, Banco de Portugal, Economics and Research Department.
    5. Zhang, Zikai & Neupane, Suman, 2024. "Global IPO underpricing during the Covid-19 pandemic: The impact of firm fundamentals, financial intermediaries, and global factors," International Review of Financial Analysis, Elsevier, vol. 91(C).
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    7. Zhang, Mengting & Du, Wenjiao, 2025. "Economic policy uncertainty, investor sentiment and IPO underpricing," International Review of Financial Analysis, Elsevier, vol. 105(C).
    8. Magnus Blomkvist & Nebojsa Dimic & Milos Vulanovic, 2023. "Oil Price Uncertainty and IPOs," The Energy Journal, , vol. 44(6), pages 21-42, November.
    9. Ifham Rizvi & Tanuj Nandan, 2026. "Use of proceeds disclosures and initial public offerings: a systematic literature review and future research agenda," Quality & Quantity: International Journal of Methodology, Springer, vol. 60(2), pages 7495-7526, April.
    10. Teplova, T. & Sokolova, T. & Kissa, D. & Gurov, S., 2026. "ESG indicators as determinants of the risk of a decline in Russian stock prices in different periods: A view of Explainable AI," Journal of the New Economic Association, New Economic Association, vol. 70(1), pages 157-190.
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