Determinants of IPO Underpricing : An empirical study based on companies in the Gulf Cooperation Council countries
| Author | Haji, Aalaa Jaafar | |
|---|---|---|
| metadata.dc.contributor.department | "University of Bahrain, College of Business Administration, Department of Economics & Finance | |
| metadata.dc.date.accessioned | 2026-09-20T15:48:27Z | |
| Publication date | 2015 | |
| Degree level | Master | |
| Abstract | Abstract : This paper documents the phenomenon of underpricing initial public offerings (IPOs) for 194 firms that went public between 2000 and 2013 in the markets of the six Gulf Cooperation Council (GCC) countries. The purpose of this study is to investigate factors that potentially influence abnormal returns on the first day trading; the study focuses on assessing the most prominent determinants of the underpricing of IPOs in the GCC region. In addition to previously tested variables such as firm age and offer size, additional untested variables in the GCC market are included, and external factors such as Seasonal Affective Disorder (SAD) have been analyzed, cultural aspects such as the month of Ramadan have been embedded to measure Islamic seasonality, and the financial crisis period has been taken into consideration as well. Once multiple regression was carried out, the empirical findings of this paper show that firm age and offer size variables are clearly significant, both positively and negatively in relation to underpricing, a result which was predicted and similar to past research. Large offer-sized firms appeared to have a positive relationship with underpricing, contrary to what was predicted. Results show that a relationship does exist between financial and non-financial firms, and there are significant differences between banking versus insurance firms. Differentiating fall/winter months from spring/summer months to measure Seasonal Affective Disorder did not appear to be significant, as there was no significant difference between issuing IPOs in fall/winter months from spring/summer months. The same thing was applied to Ramadan months, and produced similar results/ Differentiating IPOs issued in Ramadan from non-Ramadan months and summer vs. non-summer months did not seem to have a significant effect; However, the overall models were significant. The models carried out involving the financial crisis period all appeared to be significant, with the exception of the model which differentiated pre-crisis and post-crisis years. This research provides additional information that sheds more light on some of the main reasons behind IPO underpricing in the GCC region. | |
| metadata.dc.identifier.other | Drupal node 3630 | |
| metadata.dc.identifier.other | https://digitalrepository.uob.edu.bh/en/dar/determinants-ipo-underpricing-empirical-study-based-companies-gulf-cooperation-council | |
| metadata.dc.identifier.uri | http://165.227.56.122/handle/123456789/6723 | |
| Language | en | |
| Link | https://digitalrepository.uob.edu.bh/en/_flysystem/fedora/2025-06/00770_determinants_of_ipo_underpricing_an_empirical_study_based_on_companies_in_the_gulf_cooperation_council_countries.pdf | |
| Subject | Investments--Arabian Gulf States--Dissertations | |
| Subject | Arabian Gulf States-- Economic conditions-- Dissertations | |
| Title | Determinants of IPO Underpricing : An empirical study based on companies in the Gulf Cooperation Council countries | |
| Type | Master's Thesis | |
| College | College of Business Administration | |
| Department | Economics and Finance |
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