Impact of macroeconomic factors on underpricing of initial public offerings before and after the recent global financial crisis : evidence from Istanbul Stock Exchange

Underpricing of Initial Public Offerings (IPO) has always been a big deal to see the money left on the table by the issuers. This study analyzes the after-market performances of IPOs observed in 2006-2011 period in Istanbul Stock Exchange (ISE). Besides looking at the period as a whole, we divide that period into three regarding the Eight Annual Ernst & Young Global IPO Trends. This gives the opportunity to analyze the impact of macroeconomic factors before financial crisis (2006-2007), during the financial crisis (2008-2009), and after the financial crisis (2010-2011). There are 33 IPOs in 2006-2007 period, 8 IPOs in 2008-2009 period and 53 IPOs between 2009 and 2010. We use multiple regression analysis to discover the effects of the macroeconomic factors as ISE 100 index, consumer price index, consumer confidence index, interest rate, world oil price, GDP per capita on the first day performances of IPOs. -- global financial crisis ; initial public offerings ; macroeconomic changes ; underpricing