Competitive and contagion effect of initial public offerings in India: An empirical study

Title

Competitive and contagion effect of initial public offerings in India: An empirical study

Creator

Pulikottil R.P.

Description

This study aims to empirically examine the impact of initial public offerings (IPOs) on the equity share prices of industry rivals. The cross-industry sample comprises 13 companies across six different industries in the Indian market. The study investigates four key variables: the stock returns of industry rivals before and after the IPO of a new market entrant, as well as the daily traded volume of both the market entrant and industry rivals in the days following the IPO. The analysis reveals a significant association between the stock prices of industry rivals before and after the listing date of a market entrant, as evidenced by the adoption of three distinct time windows. However, no significant relationship is observed between the daily traded volume of market entrants and industry rivals. The results reveal the presence of the competitive and contagion effect and the lack of active capitalisation of this short-term phenomenon by investors. 2023 The Author

Source

Social Sciences and Humanities Open, Vol-8, No. 1

Date

2023-01-01

Publisher

Elsevier Ltd

Subject

Competitive effect; Contagion effect; Initial public offering; Investment strategy; Supply effect

Coverage

Pulikottil R.P., CHRIST (Deemed to Be University), Karnataka, India

Rights

All Open Access; Gold Open Access

Relation

ISSN: 25902911

Format

Online

Language

English

Type

Article

Identifier

https://doi.org/10.1016/j.ssaho.2023.100643

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