Media Coverage and IPO Pricing around the World

Chen, Yangyang and Goyal, Abhinav and Veeraraghavan, Madhu and Zolotoy, Leon (2019) Media Coverage and IPO Pricing around the World. Journal of Financial and Quantitative Analysis. pp. 1-39.

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We study how media coverage impacts pricing of initial public offerings (IPOs) around the world. Higher media coverage in the pre-IPO period leads to lower IPO initial returns. The effect is mitigated in countries with better financial reporting quality, greater shareholder rights protection, and more stringent media censorship, and for IPOs “certified” by reputable intermediaries, while it is amplifiedincountrieswithhigherlevelsofmediapenetration and media trust. Further, IPOs with higher pre-IPO media coverage have lower ex post price revision volatility. Our findings suggest that higher pre-IPO media coverage reduces information asymmetry among investors, leading to less underpriced IPOs

Item Type: Article
Uncontrolled Keywords: Media coverage;IPO pricing;information asymmetry
Subjects: Finance
Finance > Financial Management/Corporate Finance
Divisions: Finance and Strategy
Depositing User: Mr. Muralidhara D
Date Deposited: 17 Mar 2020 06:31
Last Modified: 17 Mar 2020 06:31

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