IPO Waiting Period in Pakistan.

This study examined the IPO waiting period from offering to the first trading day listed on the Pakistan Stock Exchange from 1995 to 2018. We find that firms that oat shares to the general public have passed through multiple layers of inspection by underwriters, auditors, institutional investors, and regulatory bodies. The waiting period of the unseasoned issue is an essential predictor of uncertainty associated with a firm. To test this proposition, we first determine the endogenous and exogenous factors that influence IPO waiting period. The results confirm that the firms offer price, percentage of shares after issuance of IPO, book building mechanism, and SECP regime influence the IPO waiting period. This study further finds that short waiting period IPOs are associated with less ex-ante uncertainty, reducing the level of underpricing. In addition, we report that during short waiting periods, IPOs are prone to less return volatility and higher aftermarket stock performance. [ABSTRACT FROM AUTHOR]