ANALYSIS OF FACTORS THAT INFLUENCE UNDERPRICING OF SHARES IN INITIAL PUBLIC OFFERINGS

Abstract

The purpose of this research is to determine and analyze the influence of debt to equity ratio, firm size, share offering percentage, earnings per share and ownership concentration on underpricing. The population in this research is the main board category companies that are carrying out IPOs on the IDX for the 2019 - 2022 period, totaling 47 companies, while the sample in this research is 33 companies determined using a purposive sampling technique. The analytical tool in this research uses multiple linear regression. The t test results of the share offering percentage have a significant positive effect on underpricing, while firm size and earnings per share have a significant negative effect on underpricing, meanwhile the debt to equity ratio and ownership concentration have no effect on underpricing. The implication of this research is that investors need to pay attention to the variables of share offering percentage, firm size and earnings per share when making decisions to invest in companies conducting an IPO in order to obtain shares that are underpriced and can benefit investors. The limitation of this research is that it cannot prove the influence of the debt to equity ratio and ownership concentration variables on underpricing in main board category companies conducting an IPO on the IDX. Future researchers should use other independent variables, for example current ratio and return on assets. Next, increase the number of years of observation and add other recording boards such as development boards and acceleration boards.