What Determines Post-IPO Market Performance: Evidence From Turkish IPOs

Authors

Fatih Macit Suleyman Sah Universit, Department of Economics, Turkey Author
Ahmet Sekreter Suleyman Sah University, Department of International Trade and Finance, Turkey Author
Selver Seda Ada Suleyman Sah University, Department of Business Administration, Turkey Author
Esra Simsek Suleyman Sah University, Department of International Trade and Finance, Turkey Author

Post-IPO performance, Turkish stock market

In this paper we investigate the determinants of the short-run post-IPO market performance of IPO stocks for

Turkish markets. We looked at various firm specific accounting and IPO related variables namely the ratio of

operating profit to total sales, the ratio of total debt to total assets, IPO size, public float, the ratio of shares that

are purchased by foreign investors, and the market value to book value ratio. We find that IPO size appears to be

the most important variable in determining the post-IPO market performance of IPO stocks. Large IPO’s tend to

have a better post-IPO market performance. Besides that firms with a larger debt ratio are expected to show a

better performance in the short-run. It is seen that as public float increases IPOs tend to show a poorer

performance.