Short Run Performance Analysis of Initial Public Offerings

Initial public offering (IPO) sets a path for raising the capital by the public for the first time by issuing shares. Raising capital from the public for the very first time by a company is called as Initial public offering (IPO). This IPOs gives a path to the company to enter into the primary market, which sets a gateway to enter the secondary market. The investors' subscription in primary market, their positive response gives the company confidence to list in secondary market and gain market position. The study emphases on short-term returns of the IPO which are listed in NSE main board. For the study IPOs listing day, 7 th , 14 th , 21 st and 28 th day closing price data are taken and analysed. The paper aims to analyse the investors getting back for their investment in short-term only which is listed from January 2021 to June 2021, 6 months data is taken. The total companies listed during the period in NSE main board are 18 companies, all the companies are taken for the analysis. The study interprets that the listing day price impacts on the return in the coming days of listing. Closing price on listing day is less than the issue price the future day's price also be subject to the listing day. This study investigates the short-term analysis of initial public offerings (IPOs) listed in NSE and highlight the impact of listing date prices on subsequent returns. The results show that IPOs tend to provide investors with favourable short-term returns based on the closing price on the listing date. Conversely, IPOs that close above their issue price tend to continue to rise in the stock market, if investors with higher short-term returns. Overall, the study suggests that IPOs listed on the NSE Main Board have the potential to generate short-term profits, but paying close attention to the listing day price can have a significant impact on profitability. This understanding is essential for investors looking to capitalize on short-term profits and highlights the importance of strategic pricing of IPOs by issuing companies to ensure value creation for stakeholders.