ScholarWorks@경상국립대학교

초록

This study investigates how the intensity of newly listed firms’ globalization activities affects IPO underpricing and long-term under-performance phenomena in Korea. Design/Methodology/Approach -  This study uses a merged data set of accounting, financial market, and patent rights from 570 IPOs listed on Korea Exchange (KRX) from 2002 to 2016. We collect data from KIS (Korea Information Service) - Value, IPO Stock Inc., and WIPS databases. Then, we formally test our hypotheses using multivariate regression models, with linear and non-linear quadratic terms in the models. Findings -  First, the globalization of Korean IPO firms does not show any effects on IPO initial returns, while their exports show a negative effect on initial returns. Second, R&D intensity exhibits an inverse U-shaped relationship with initial abnormal returns right after IPO lasting only up to one year. Third, the effects of high initial returns on long-term stock returns are positive from the second year after IPO, lasting for 4 more years. Fourth, the numbers of patent rights, total, local and global, show an inverse U-shaped relationship with long-term stock returns, which are statistically negative in regressions only in the first year after IPOs. Research Implications -  We find that Korean IPO firms’ globalization has little impact on IPO underpricing and long-term underperformance. Rather, R&D expenditures aggravate information asymmetry for IPO firms while the patent rights alleviate information asymmetry. Investors’ responses in Korean stock markets are somewhat different from related literature.

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