<abstract xmlns="http://www.w3.org/1999/xhtml"><p>The first issue of shares is the key moment in the life cycle of any company that was not previously listed on a stock exchange. Considering the fact that transformation into a public open joint stock company brings along a number of advantages and challenges, it would be of great importance to possess knowledge about initial public offering (IPO) issuing activity, as well as stay updated with the number and value of globally realised IPOs. The aim of the paper is to use the comprehensive analysis of IPOs realisation process in order to point out the importance of going public, having in mind both the corporations and investors in the capital market, as well as the economy as a whole. In accordance with the set goal, the paper will present the effects of the realised IPO processes in the countries of Western Europe, China, Japan and the USA. When it comes to developing countries, the IPO of shares on a stock exchange is of special importance, since it contributes to the further development of capital market. Due to the particularity of the Serbian macroeconomic environment, the trends of privatisation process, the insufficient protection of investors, the high level of information asymmetry and the lack of corporate education, there have been no IPO processes realised on the Belgrade Stock Exchange over the past eight decades.</p></abstract>

The first issue of shares is the key moment in the life cycle of any company that was not previously listed on a stock exchange. Considering the fact that transformation into a public open joint stock company brings along a number of advantages and challenges, it would be of great importance to possess knowledge about initial public offering (IPO) issuing activity, as well as stay updated with the number and value of globally realised IPOs. The aim of the paper is to use the comprehensive analysis of IPOs realisation process in order to point out the importance of going public, having in mind both the corporations and investors in the capital market, as well as the economy as a whole. In accordance with the set goal, the paper will present the effects of the realised IPO processes in the countries of Western Europe, China, Japan and the USA. When it comes to developing countries, the IPO of shares on a stock exchange is of special importance, since it contributes to the further development of capital market. Due to the particularity of the Serbian macroeconomic environment, the trends of privatisation process, the insufficient protection of investors, the high level of information asymmetry and the lack of corporate education, there have been no IPO processes realised on the Belgrade Stock Exchange over the past eight decades.

The Importance of Initial Public Offering for Capital Market Development in Developing Countries

Economic Themes

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

The first issue of shares is the key moment in the life cycle of any company that was not previously listed on a stock exchange. Considering the fact that...

The Importance of Initial Public Offering for Capital Market Development in Developing Countries

Published Online: Jul 09, 2020

Page range: 97 - 115

Received: Jan 14, 2019

Accepted: Apr 20, 2020

DOI: https://doi.org/10.2478/ethemes-2020-0006

Keywords
initial public offering (IPO), going public, capital market, underpricing, information asymmetry, stock exchange

© 2020 Aleksandra Pešterac, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

The Importance of Initial Public Offering for Capital Market Development in Developing Countries

Published Online: Jul 09, 2020

Page range: 97 - 115

Received: Jan 14, 2019

Accepted: Apr 20, 2020

DOI: https://doi.org/10.2478/ethemes-2020-0006

Keywordsinitial public offering (IPO), going public, capital market, underpricing, information asymmetry, stock exchange

© 2020 Aleksandra Pešterac, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Keywords
initial public offering (IPO), going public, capital market, underpricing, information asymmetry, stock exchange