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Abstract: <br /> <br /> <br /> <br /> <br /> Profit seeking companies meaning that the companys goal is to maximize share holders value and companys profit. In order to do so, one of the ways to finance the companys business activities is by doing Initial Public Off...
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| Format: | Final Project |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/5971 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | Abstract: <br />
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Profit seeking companies meaning that the companys goal is to maximize share holders value and companys profit. In order to do so, one of the ways to finance the companys business activities is by doing Initial Public Offering (IPO) meaning that the company lists their share through capital market. Parties involved in IPO are the company itself, investor, underwriter and the market regulator. The settlement price of shares listed in IPO is very important to the company because it determines whether the IPO will success or fail, and each partys interest would affect the settlement price process. The purposes of doing IPO are to gain additional capital from public or external investor, and to expand the companys business capacity. It provides accsess to public equity capital so may lower the cost of funding the companys operations activities, but at the same time the company acquires new obligations in the form of transparency and disclosure requirements. IPO has interested many financial economists both local and international for many decades and a large body of empirical studies has confirmed the finding that IPO tends to be under-priced and it is costly for the firms owner. Underpricing in IPO meaning that the IPO price set in the primary market is lower than the price set in the secondary market for the same particular stock. |
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