شهرت و اعتبار بانک سرمایه گذاری و الزامات فهرست آرام : شواهدی از IPOs شرکت زیرساخت در هنگ کنگ

In early 1996, the Stock Exchange of Hong Kong allowed firms focusing on infrastructure projects to issue initial public offerings (IPOs) under a relaxed set of listing requirements, allowing these firms to go public with a shorter history or lower profitability levels. We provide evidence that these firms are no more speculative than firms listing under the regular requirements. To the contrary, we find that firms listed under the relaxed requirements are taken public by reputable investment banks and that these firms have characteristics that otherwise mitigate their lack of earnings history. These patterns are consistent with investment banks avoiding highly speculative issues to protect their reputations.

In this paper, we provide evidence on the Stock Exchange of Hong Kong’s Ž experience with relaxed listing requirements for infrastructure firm IPOs sub-rule Ž.. 8.05 2 . By comparing the characteristics and subsequent performance of the relaxed listing IPOs to IPOs listing under the regular requirements, we show that there is no discernible difference in performance across the two groups. Although the firms listed under the relaxed listing requirements must do so due to a lack of operating history or profitability, it appears that the firms taken public under these requirements to date are otherwise no more speculative than issues under the regular requirements. We do find evidence, however, that firms going public under the relaxed requirements sell a smaller fraction to the public at a higher offer price and have lower variability in stock prices. These findings suggest relatively less risk for the relaxed listing firms. There is also evidence that, prior to the IPO issue, these firms had a larger number of operational projects, more turnover, or higher net income than the regular listing firms. These patterns are consistent with investment banks choosing not to take highly speculative issues public in order to protect their reputations. Clearly, this sample is small and the results cannot necessarily be generalized to other markets or industries. Indeed, there are several examples of exchanges with relatively relaxed listing rules that have failed, at least in part, due to the failure of ŽŽ. some highly speculative issues. For example, see Aggarwal and Angel 1999 for . a discussion of the American Stock Exchange’s Emerging Company Marketplace. The SEHK’s experience with relaxed listing rules for infrastructure firms, how- ever, provides evidence that is consistent with reputation concerns prompting investment banks to carefully screen which firms to sponsor under the relaxed listing rules.