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Title: Do group-affiliated firms time their equity offerings?
Authors: Wadhwa, Kavita
Neupane, Suman
Syamala, Sudhakara Reddy
Keywords: Group-affiliated firms
Long–run performance
Public equity offerings
Stand-alone firms
Issue Date: 2019
Publisher: SCOPUS
Pacific Basin Finance Journal
Elsevier B.V.
Series/Report no.: 54
Abstract: Using IPO and SEO data from the Indian capital market, we examine whether group-affiliated firms are able to time their equity issuance relative to stand-alone firms. Group-affiliated firms have access to internal capital markets, which, we argue should allow these firms to raise external capital at an opportune time. Using both direct and indirect measures of market timing, the main finding of our paper is that there are significant difference in how group-affiliated and stand-alone firms raise capital through IPOs and SEOs. We find that stand-alone firms raise more capital and time their IPO offerings whereas group-affiliated firms raise more capital and time their SEO offerings. Consistent with the notion of market timing, we find that the long run underperformance is pronounced for stand-alone IPO and group-affiliated SEO offerings.
Description: Wadhwa, Kavita, Department of Finance, Indian Institute of Foreign Trade (IIFT), India; Neupane, Suman, UQ Business School, The University of Queensland, Brisbane, QLD 4072, Australia; Syamala, Sudhakara Reddy, Finance and Control Group, Indian Institute of Management Calcutta, India
ISSN/ISBN - 0927538X
DOI - 10.1016/j.pacfin.2019.02.004
Appears in Collections:Finance and Control

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