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An Empirical Assessment of A-Share IPO Under-Pricing in China
ECU Publications 2012
  • Chan-Hyun Sohn
  • Albert Tsui
  • Feng Zhang
  • Zhaoyong Zhang, Edith Cowan University
Publication Date
Document Type
Journal Article
Faculty of Business and Law
School of Accounting, Finance and Economics / Finance, Economics, Markets and Accounting Research Centre

This article was originally published as: Sohn, C., Tsui, A., Zhang, F., & Zhang, Z. (2012). An Empirical Assessment of A-Share IPO Under-Pricing in China. Seoul Journal of Business, 18(1), 25-57. Original article available here


This paper investigates the under-pricing and long-run performance of 230 A-share IPOs issued in the Chinese markets using comparable firm multiples. We find that A-share IPOs are severely under-valued by issuers and underwriters at the offer, but over-valued by investors on the listing day. Both contribute to the severe under-pricing of IPOs in China. Our findings are robust across stock exchanges, classification of firms, criteria for choosing matching firms; absence of CSRC regulation and B-share market prices, respectively. The results also show that those over-valued IPOs by investors on the listing day under-perform those under-valued IPOs in the long-run.

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Citation Information
Chan-Hyun Sohn, Albert Tsui, Feng Zhang and Zhaoyong Zhang. "An Empirical Assessment of A-Share IPO Under-Pricing in China" (2012)
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