Cross-sectional determinants of post-IPO stock performance: Evidence from China

Xin Chang, Shi Hua Lin, Lewis H.K. Tam, Lap Bun Wong

Research output: Journal article publicationJournal articleAcademic researchpeer-review

12 Citations (Scopus)


This paper examines the cross-sectional determinants of post-IPO long-term stock returns in China. We document that the aftermarket P/E ratio has the most robust negative association with post-IPO stock returns. The negative relation indicates that the market corrects the aftermarket overvaluation of IPO firms in the long run. Underwriter reputation has a positive effect on post-IPO stock returns, while board size has a negative impact, consistent with the views that reputable underwriters mitigate the information asymmetry in IPO pricing and over-sized boards reduce the effectiveness of corporate governance. However, we find little evidence indicating that the equity ownership structure is significantly associated with post-IPO stock returns. Accounting and Finance
Original languageEnglish
Pages (from-to)581-603
Number of pages23
JournalAccounting and Finance
Issue number3
Publication statusPublished - 1 Sept 2010

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics, Econometrics and Finance (miscellaneous)


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