Anticipated and actual use of capital raised in Malaysian IPO Market
This study investigates the anticipated and the actual use of capital raised from initial public offering (IPO) in Malaysia. The descriptive analysis shows that companies anticipate the use of capital mainly for growth opportunities (47%), working capital (27%), debt repayment (12%) and listing expe...
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my.uum.repo.258022019-04-01T00:42:57Z http://repo.uum.edu.my/25802/ Anticipated and actual use of capital raised in Malaysian IPO Market Badru, Bazeet Olayemi Ahmad Zaluki, Nurwati Ashikkin Wan Hussin, Wan Nordin HB Economic Theory This study investigates the anticipated and the actual use of capital raised from initial public offering (IPO) in Malaysia. The descriptive analysis shows that companies anticipate the use of capital mainly for growth opportunities (47%), working capital (27%), debt repayment (12%) and listing expenses (13%). Further analysis indicates that 54% of IPO companies have dedicated more than 50% of the amount of capital raised for growth opportunities. Very few companies planned to use the capital raised for research and development (R&D) and marketing activities. The regression results also confirm that the anticipated use of capital for R&D and marketing have no significant relationship with total amount of capital raised. In addition, a content analysis of the chairmen’s statements and the section dedicated for actual use of capital raised in the annual reports reveal that majorly 73 out of 121 companies’ exhibit changes in the anticipated use of capital raised. Therefore, this study concludes that relevant parties in the IPO process (e.g., regulators, issuers, financial intermediaries and investors) should pay close attention to the anticipated and actual use of capital raised. 2016 Article PeerReviewed application/pdf en http://repo.uum.edu.my/25802/1/SBE%2019%201%202016%2034%2049.pdf Badru, Bazeet Olayemi and Ahmad Zaluki, Nurwati Ashikkin and Wan Hussin, Wan Nordin (2016) Anticipated and actual use of capital raised in Malaysian IPO Market. Studies in Business Economics, 19 (1). pp. 34-49. ISSN 1818-1228 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3010925 |
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HB Economic Theory Badru, Bazeet Olayemi Ahmad Zaluki, Nurwati Ashikkin Wan Hussin, Wan Nordin Anticipated and actual use of capital raised in Malaysian IPO Market |
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This study investigates the anticipated and the actual use of capital raised from initial public offering (IPO) in Malaysia. The descriptive analysis shows that companies anticipate the use of capital mainly for growth opportunities (47%), working capital (27%), debt repayment (12%) and listing expenses (13%). Further analysis indicates that 54% of IPO companies have dedicated more than 50% of the amount of capital raised for growth opportunities. Very few companies planned to use the capital raised for research and development (R&D) and marketing activities. The regression results also confirm that the anticipated use of capital for R&D and marketing have no significant relationship with total amount of capital raised. In addition, a content analysis of the chairmen’s statements and the section dedicated for actual use of capital raised in the annual reports reveal that majorly 73 out of 121 companies’ exhibit changes in the anticipated use of capital raised. Therefore, this study concludes that relevant parties in the IPO process (e.g., regulators, issuers, financial intermediaries and investors) should pay close attention to the anticipated and actual use of capital raised. |
format |
Article |
author |
Badru, Bazeet Olayemi Ahmad Zaluki, Nurwati Ashikkin Wan Hussin, Wan Nordin |
author_facet |
Badru, Bazeet Olayemi Ahmad Zaluki, Nurwati Ashikkin Wan Hussin, Wan Nordin |
author_sort |
Badru, Bazeet Olayemi |
title |
Anticipated and actual use of capital raised in Malaysian IPO Market |
title_short |
Anticipated and actual use of capital raised in Malaysian IPO Market |
title_full |
Anticipated and actual use of capital raised in Malaysian IPO Market |
title_fullStr |
Anticipated and actual use of capital raised in Malaysian IPO Market |
title_full_unstemmed |
Anticipated and actual use of capital raised in Malaysian IPO Market |
title_sort |
anticipated and actual use of capital raised in malaysian ipo market |
publishDate |
2016 |
url |
http://repo.uum.edu.my/25802/1/SBE%2019%201%202016%2034%2049.pdf http://repo.uum.edu.my/25802/ https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3010925 |
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13.18916 |