China Bank Shares Ipo Pricing Analysis And Empirical Research

As the increasing development of reform in financial industry , the reform of commercial banks is on the way as well. More and more commercial banks would improve the structure of corporation management and core competition by listing.,which relates to pricing. The research objectives are to objectively describe IPO pricing of banks since 1999, research the relationship among factors and IPO pricing, and give suggestions about improving IPO pricing through the compositive method of theory analysis and experiential analysis.First, it introduces the IPO theories, including: Cash flow model, CAPM model, and Econometric model, and their applicability in China. It concludes that Econometric model is the most appropriate model for IPOs in China. And we do this research on the base of this proposition.Second, combined with the research results home and abroad and banks' characteristics, it qualitatively analyzes the main factors affecting IPO pricing from both inside and outside and establishes the elementary system for IPO pricing. Basing on this system, it does experiential analysis on IPO pricing of 7 listed banks since 1999 by use of principal component analysis and correlation analysis. It establishes the multi-factor regression model for IPO pricing of banks and finds 5 main factors from the regression results. In order to ensure the rationality and feasibility of the new-built model, it also uses the model to forecast the A share's IPO price of ICBC. It compares the results to the actual IPO price to prove the model's rationality. We find some interest phenomena in the research which are as follows:(1) Macro-economy matters in the IPO pricing of listing banks.(2) It shows negative relation between macro-economy and the IPO pricing.(3) Primary market has little relation with Secondary market, and the latter has little relation with IPO pricing. (4) The efficiency of IPO launching system is low and it's not appropriate for the market launching one.Last, it brings forth suggestions to improve IPO pricing of banks from the IPO system and bank industry. It's better to strength core competition and risk management in order to improve the IPO price. And (1) perfecting the stock market ,(2) advancing the development of IPO system, (3) exerting the advantage of Booking Building, (4) extending the scope of institutional investor are related suggestions to perfect the IPO launching system.