Information Asymmetry Or Collusion

Since the IPO pricing randomness after the marketization of issuing shares, thephenomenon of listed companies raised funds exceeded plan’s called “Over-raised”. InChina, the implementation of centralized audit and distribution system in GEM makes theraised funds outbreaks in a short time and becoming the target of public criticism. As aphenomenon peculiar to the transition of emerging capital markets, the topic of listedcompanies over-raised becomes the common concern of scholars, medias and academics,especially that in GEM. Over-raised fund leads to scarce source wrongly rationed to lowgrowth companies or inefficient allocation to high quality companies, which damages theresource allocation efficiency of capital markets. At the same time, over-allocation offunds is also likely to lead to serious consequences of inefficient use of funds, derivedwaste, misappropriation, and ultimately affect the sustainability of China’s economicdevelopment and upgrading of industrial structure. In order to further improve theefficiency of the capital market to ensure China’s securities market develops healthily andstably, as well as to safeguard the healthy development of newborn GEM market, it isneeded to alleviate and avoid the phenomenon of over-raised. To solve this problem, theprerequisite is to explore its causes. Then it could be possible to improve this phenomenonradically and to improve the efficiency of capital allocation of market resources.Most of current studies on the issue of over-raised stayed in a qualitative point ofview to analysis the reason, impact and coping strategies. Quantitative research focuses onthe use of over-raised funds. But few normal empirical papers explored the reason. Thisdissertation takes China’s355companies in GEM listed from30thOctober,2009to31stDecember,2012as samples, simultaneously take information asymmetry and collusion(between underwriters and listed companies) into consideration to examine the reason ofover-raised for the first time, and finally get the conclusion of both aspects have effect onthe GEM’s over-raised issue through theoretical analysis and empirical test. Thisconclusion makes up for the blank of existing research and has a theoretical significance toa certain extent.