Proceedings of 23rd International Business Research Conference
18 - 20 November, 2013, Marriott Hotel, Melbourne, Australia, ISBN: 978-1-922069-36-8
Exit via IPOs: An Insight into the Listing Requirements of
the Emerging Growth Enterprise Market of China
Hai Long
As listing requirements are different across listing markets, the
emerging Growth Enterprise Market of China launched in 2009, has
strict entry requirements for financial factors. This study aims to
examine the impact of these determinants on the IPO probability in the
listing market.
Adopting a sample of the initial 243 IPOs in the market over 2009 to
2011 period, this paper develops a regression model to investigate the
relationships between these factors and find that the net profit and its
growth rate determine the IPO volume substantially. In addition, this
study adopts a probit model to test the affection of the four factors on
IPO likelihood. The findings are: 1) the fundraising amount as one of
the most significant IPO determinants is positively associated to IPO
probability on the market; 2) the net profit as a fundamental IPO
determinant is positively associated to IPO probability as well, which
confirmes the fact that the GEMC is a profit-preferred listing venue; 3)
the net assets determine IPO probability but not IPO volume of the
issuers.
JEL Codes: G15, G24
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Mr. Hai Long, PhD Candidate, School of Business, Edith Cowan University, Australia,
Email: soholonghai@163.com, Ph:0410317703.