Venture backed IPOs in the Philippines: Underpricing, performance, and issues of certification from 1994-2012

• Main Authors: Andulan, Mina Minorka B., Cadao, Ana Graciela I., Ferrer, Genalynne Rose R., Sanchez, Maria Leona M.
• Format: text
• Language: English
• Published: Animo Repository 2014
• Subjects: Going public (Securities) > Philippines; Corporations > Finance; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/7864
• Institution: De La Salle University

This study examines the difference between venture capital backed and non-venture backed IPO in terms of underpricing, determine if venture backed companies do better after listing in terms of monthly returns and if the presence of venture capitalists in the board signal IPO certification of quality. Linear regression is used to test for the underpricing and performance while logistics regresssion is used to test for the certification of quality. Amongst all the variables used in the three models, only the variable LDELAY yielded significant. It was concluded that VC backed IPOs differ from non-VC backed IPOs in terms of underpricing due to the VC backed IPOs having wider access to information to offer its potential investors, VC backed IPOs do not outperform non-VC backed IPOs but they have a stable growth for the span of three months, and the presence of venture capitalists on the board does not signal IPO certification of quality due to companies going public through the Philippine Stock Exchange are required to have a certification regardless of its composition.