Singla, H K (2020) Does ownership structure and market sentiment affect the performance of IPOs in India in short run? A dynamic panel data analysis. Journal of Financial Management of Property and Construction, 26(1), pp. 1-22. ISSN 1366-4387
Abstract
Purpose: This study aims to compare the short-run performance of construction and non-construction initial public offerings (IPOs) that are offered in India during 2006–2015. The study also attempts to investigate the impact of ownership structure (i.e. concentrated ownership in the hand of promoters and institutional ownership) and market sentiment on the performance of construction sector IPOs in short run. Design/methodology/approach: A total of 281 IPOs were listed at National Stock Exchange, India, during the study period, and 44 of those were from construction sector. The short-run performance of these construction and non-construction IPOs was compared using two indicators, i.e. monthly stock return (SR) and excess return over market benchmark (MAR). To examine the effect of concentrated ownership in the hand of promoters, institutional ownership and market sentiment on IPO performance, systematic dynamic panel regression model was developed. Findings: The IPOs of construction firms perform significantly better than the non-construction firms. The performance of construction IPOs is significantly driven by the lag effect. This suggests a significant informational inefficiency, which results in a delayed reaction by investors. The market sentiment has a positive influence on the performance of construction sector IPOs, whereas the institutional holding has a negative influence. Originality/value: To the best of the author’s knowledge, this study is the first attempt to examine the performance of construction sector IPOs in short run. The study uses systematic dynamic panel data regression, which provides better and reliable estimates.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | construction; India; institutional holding; ipos; market sentiment; ownership structure; promoter holding; retail holding |
| Index terms: | regression model, investor, India, estimate, ownership, construction firm, data analysis, promoter, construction sector, methodology |
| Subjects: | sociology, industry analysis, statistical analysis, economics, research methods, Geography, data analysis and analytics, financial and cost management, organization |
| Topics: | Organizational Design, Stakeholder Management, Geographical Context, Research Practice, Cost Management, Business Strategy |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here