Research On IPO Pricing Mechanism On View Of Justice And Efficiency

With the development of Chinese economy, stock market has an incremental importance on the enterprise financing. A-shares-raised-capital was approximately 488.2billion yuan in 2010 alone, increased by 159.9%. Nothing but an IPO mechanism designed according to the certain circumstance of the reality and gave consideration to both justice and efficiency can maintain the sustainable development of stock market; what's more, IPO pricing mechanism is the core of IPO mechanism. This is the starting point of the article.Under the background tells above, this article is to analyze the aspects of IPO pricing mechanism respectively on the view of justice and efficiency. The research idea consists of:first, whether the current IPO pricing mechanism is both just and efficient; second, whether the mechanism after reformation performs well than before in term of justice and efficiency. The method to research is that we made both positive analysis and case analysis to find whether the reformation of IPO mechanism has a positive impact on the stock market.In the article, the research on the issue of justice is divided into four parts:market accesses, information disclosure, application for purchase and justifiability of financing-project as these four parts constitute an integral issuance process while the research on the issue of efficiency is divided into five parts:efficiency of issue, efficiency of investment, reasonability of financing volume, project modification and long-run investment return. Which be worth to note is that justice and efficiency are two sides of one coin, and these two shall be considered as a integrated one.We find that the government puts emphasize on market-oriented IPO pricing mechanism reformation, however, the reformation of the other aspects of IPO mechanism as complements fall behind. It causes conflict between aspects of IPO mechanism and finally reduce the effect of market-oriented reformation. As what revealed by case-analysis and positive analysis, no evidence supports the idea that the reformation is a success, actually it fails.Under the analysis above, I gave my consideration about how to improve the justice and efficiency of IPO pricing mechanism at the end of the article.First, the government should provide a complete legal system and supervision system to enhance the quality of information disclosure. Second, define the boundary of government to reduce unwanted interfere with the market and make the invisible hand play a role.Third, progress the construction of the multi-level capital market to meet the need of multi-level financing and investment. Delisting provision should be drawn up to strengthen the market function of "voting by leg".Fourth, progress the construction of market environment, carry out investor education to promote individual investors' consciousness of risk and rights safeguarding.Fifth, strengthen social credibility construction. A social-wild faith-oriented environment is the fundament of a just and efficient IPO pricing mechanism.