Published Online:January 2026
Product Name:The IUP Journal of Accounting Research & Audit Practices
Product Type:Article
Product Code:IJARAP060126
DOI:10.71329/IUPJARAP/2026.25.1.96-126
Author Name:Geetha Iyer, Kalyani Mulchandani, Bhavyaraj Singh3 Anshuman Thapliyal and Devansh Gupta
Availability:YES
Subject/Domain:Finance
Download Format:PDF
Pages:96-126
The paper analyzes IPO underpricing in India’s financial market, focusing on anchor investors’ role. It expands discussions on institutional investment’s impact on market activities, examining how anchor investors serve as quality indicators in the IPO market, potentially affecting underpricing before and after public listing. It analyzes 225 IPOs listed on the National Stock Exchange (NSE) between 2015 and 2022. The RANSAC algorithm handles data points related to IPOs in the Indian financial sector. This methodology was chosen for removing outliers and revealing patterns in noisy financial datasets. Robust regression was utilized to investigate firm-specific and market-specific variables. The empirical results indicate several factors influencing IPO underpricing. The liquidity ratio shows positive correlation with pre- and post-market underpricing, suggesting more liquid stocks have higher underpricing. Larger IPOs, indicated by issue size, are associated with less underpricing. The study notes anchor investors and institutional buyers’ positive influence on pre-market underpricing. It adds to the understanding of IPO valuation strategies and market behaviors, highlighting the importance of strategic underpricing and anchor investors.
The initial public offering (IPO) represents a pivotal transition for private companies in India, signifying their entry into the public capital markets. This process, regulated by the Securities and Exchange Board of India (SEBI), allows companies to raise funds by offering shares to the public. The primary objectives for going public typically include securing capital for expansion, reducing existing debt obligations, and providing exit options for early stakeholders.