The underpricing of initial public offerings of Russian companies

The paper examines the underpricing of initial public offerings of ordinary shares of Russian companies. It is based on the data of 102 IPOs of Russian issuers for 2002-2024. The econometric study using multiple regression models has shown that factors such as the sale of own shares by initial shareholders, high-tech nature of the company's activities, the period of a “hot” market, and the deviation of the actual share placement price from the expected one, increase the underpricing of the IPO. At the same time, it was found that the amount of capital raised, the prestige of the investment bank-underwriter and the auditor have a significant negative effect on IPO underpricing. The results of the study may be useful to investors when making decisions about investing in IPOs, to regulators when developing regulations, and to issuing companies when forming an IPO strategy.