Author(s): Iqbal Thonse Hawaldar, Naveen Kumar K.R. & Mallikarjunappa T.
After the scrapping of Capital Issues (Control) Act, 1947 putting an end to the regime of Controller of Capital Issue (CCI) and allowing free pricing of public issues, capital market in India witnessed IPO activities from different sectors of the economy which was hitherto restricted by the CCI. The present paper tries to study two of the widely researched IPO anomalies in India during the free-pricing era: initial underpricing and long run underperformance. Consistent with the extant work, we find that IPOs in India belonging to the period 1992-2011 are also significantly underpriced. However, contrary to most of the international findings, the long run performance of these IPOs is also found to be positive and significant.