Will Venture Capital And Underwriter Reputation Mitigate The Impact Of R & D Investment On IPO Underpricing Of Chinese STAR Market Enterprises?

The phenomenon of IPO underpricing is widespread in all capital markets around the world,especially in China’s stock market.For Chinese STAR Market enterprises,R & D investment is the foundation for Chinese STAR Market enterprises to maintain a leading position in the industry.If there is a positive correlation between R & D investment and IPO underpricing,in order to reduce IPO underpricing,STAR Market enterprises should reduce their R & D investment.However,if enterprises lack sufficient R & D investment,it may be difficult for enterprises to maintain or even enhance their core competitiveness and innovation power.According to previous scholars’ research,the participation of venture capital and reputable underwriters can play a certification role for enterprises to a certain extent.Therefore,this paper attempts to combine the two with R & D investment and IPO underpricing of STAR Market enterprises.This paper mainly studies the participation of venture capital and whether reputable underwriters can alleviate the IPO underpricing caused by information asymmetry caused by R & D investment.At the same time,other scholars in the future can get some reference when looking for feasible methods that enable enterprises to continue to increase R & D investment,improve innovation advantages,help alleviate IPO underpricing rate and reduce issuance costs.Based on the above reasons,this paper takes 413 enterprises listed on the China STAR Market from 2019 to May 31,2022 as a sample.Firstly,this paper makes an empirical analysis on the relationship between R & D investment and IPO underpricing of Chinese STAR Market enterprises;Secondly,based on the data of 330 STAR Market enterprises with venture capital background in the sample of 413 enterprises,this paper investigates and analyzes the regulatory role of venture capital participation and reputable underwriters in R & D investment and IPO underpricing of Chinese STAR Market enterprises;Finally,combining R & D investment,IPO underpricing of Chinese STAR Market enterprises,venture capital participation and reputable underwriters,this paper further investigates the situation when venture capital participation and reputable underwriters play a regulatory role at the same time.Finally,this paper draws the following conclusions:(1)there is a significant positive correlation between R & D investment intensity and IPO underpricing of Chinese STAR Market enterprises;(2)the participation of venture capital can significantly alleviate the positive impact of R & D investment on IPO underpricing of Chinese STAR Market enterprises,and reputable underwriters can also significantly alleviate the positive impact of R & D investment on IPO underpricing of Chinese STAR Market enterprises;(3)when the participation of venture capital and reputable underwriters exist at the same time,the participation of venture capital and reputable underwriters can significantly alleviate the impact of R & D investment on IPO underpricing of Chinese STAR Market enterprises.At the same time,venture capital will play a greater role than reputable underwriters.