• Asia-Pacific Journal of Business
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• v.8 no.2
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• pp.1-14
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• 2017

Initial public offering (IPO) has been well known to be underpriced initially and under-performed in the long run. However, whether an IPO is underpriced or not strongly depends on how to measure the fair value. This paper hand collects data of IPOs newly listed in Korea market when whether IPO is overpriced or not is clearly distinguishable. The overpriced IPO refers to as the one the underwriters buy back after the listing. With the data, the paper examines that IPOs are overpriced and that the characteristics are related to the underpricing at the aftermarket dates and the performance in the long run. The data of clearly overpriced IPOs are little available from other IPO markets like US IPO market. From the data of IPOs listed under the underwriting rule of market stabilization, the results obtainable are the followings. First of all, the average initial return 70% of the underpriced IPO at the aftermarket dates is greater than the one 40% of the overpriced one. The overpriced IPOs are priced highly over the mid prices of the price bands at the pricing dates and then supported by relatively higher subscription rates of individual investors. The probit analyses moreover report that individual investors do not distinguish the overpricing of IPOs from the underpricing. These imply that the overpricing is strongly affected by the underwriting rule on the initial pricing.

• Proceedings of the Technology Innovation Conference
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• 1999.12a
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• pp.123-158
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• 1999

This study examines the differences in the various characteristics of the firms along their growth stage based on the survey data of 2,515 Korean ventures. Venture characteristics include KSFs(Key Success Factors), environment attributes of their product markets, CEO roles, the use of OPR(Other Peoples Resource). Growth stage of the ventures are classified by their dominant management problems: foundation, the market launch of the first proprietary product or service, The Outset of second generation product or service, and the Initial Public Offering (IPO) and stabilization. The results of this study show substantial differences in many aspects among firms at different growth stages. Although common KSFs exist, KSFs are changing as the venture evolves. Differences in KSFs and environmental attributes along growth stage require CEO to do different role in business process. Different kinds and amounts of external resources are needed according to their growth stage. However, almost all of external resources are offered to ventures in later stage. Entrepreneurs need to change their role, as their firms grow, from visioning and strategic role to marketing and production emphasized role. Based on the results, this study suggests a number of new government policies and future research ideas. Other implications and limitations of this study are also noted.