The Case Analysis assesses students’ understanding of capital raising by Australian companies through an initial public offering (IPO) and its impact on firm’s performance. The focus is on the four puzzles identified in academic literature concerning IPOs:
- Costs of IPOs are very high.
- On average, IPOs appear to be under-priced.
- The number of IPOs are cyclical.
- The medium to long run performance of a new public company (3 – 5 years from the date of issue) is poor.
identify any three Initial Public Offerings (IPOs) on the Australian Securities Exchange (ASX) of an amount of at least $100m that occurred during the 8-year period from 2007 to 2013. They should be from different industries. Using information from annual reports and other sources such as analysts’ reports, evaluate whether the funds raised from the IPO were used to finance viable investment projects. If some of the funds raised contributed to working capital needs, you should highlight that
