Impact of Macroeconomic Factors on Initial Public Offer: An Analytical Study of Investor’s Decision

Abstract

The financial performance and economic stability of any listed company in India will be measured using various financial and accounting methods. The premise of such matters starts with IPOs (Initial Public Offerings) being issued at the right time and suitable period. Before launching any IPO, a particular company will study a lot of macro and micro economic factors of the concerned region and their impact on IPO success rate. An IPO is a giant leap for a company as it gives access to raising colossal capital. This enhances the ability of a company to expand exponentially. This paper attempted to study several macroeconomic factors that impact Uttar Pradesh's state in the Agra division districts (Agra, Firozabad, Mathura, and Mainpuri) and the investor purchase behavior of different IPOs. Additionally, the research examines four factors namely GDP, Unemployment, Inflation, and Interest rates that are comparatively more significant in a long-run relation. This research found that GDP, inflation rate, and interest rate substantially impact IPO purchase decisions. However, the rate of unemployment has been discovered to have no significant effect on investors' IPO purchase decisions.