The underpricing of intial public offerings in the Athens stock exchange

Abstract

This study investigates the price performance of initial public offerings (IPOs) launched on
the Athens Stock Exchange (A.S.E.) during the period 1994-2002. Specifically, it examines the
differences between the listing price of IPOs and their equilibrium market prices formed at the
end of the first day and at the end of some pre-determined days during the first year of stocks'
trading. We find that Greek IPOs had on average large positive initial returns as well as positive
one-year returns. The finding of positive one-year returns is inconsistent with international
evidence. The IPO puzzle on the Greek stock market is also examined according to the new
issues' listing board classification - Main, Parallel or New Market of the A.S.E. - during the
period 1994-2002.