Review of Short Term and Long Term Performance of Initial Public Offering

Abstract

In today’s modern corporate world the concept of initial public offerings has gained much importance because it’s over and under performance can significantly affect the success of company. The current study aims at conducting a nonsystematic review of literature on the concept of initial public offering in order to understand its meaning and dimensions. In this regard a thorough review of existing literature has done and it has found that initial public offering concept has been explained by theorists in different ways. It meaning has significantly changed with changes in the business trends of corporate world. It was further found that over performance in short run and underperformance in the long run of initial public offering has remained mystified for the researchers although the performance of initial public offerings has significant effect on success or failure of a company. It is therefore concluded that the researchers should try to comprehend the conceptual nature and dimensions of initial public offering by examining its effects on the success of companies. In this way the companies in modern corporate world can ensure their success through effective utilization of initial public offerings.