The financial performance of Saudi Arabian IPOs
International Journal of Islamic and Middle Eastern Finance and Management
ISSN: 1753-8394
Article publication date: 21 June 2011
Abstract
Purpose
The main objective of this paper is to measure Saudi Arabian initial public offerings' (IPOs) financial performance before and after going public on the Saudi Stock Exchange Market. The paper also aims to explore factors associated with the financial performance variation between pre‐ and post‐IPO.
Design/methodology/approach
A sample of 16 Saudi IPOs is investigated. A matched pairs methodology is mainly used combined with regression analysis.
Findings
Saudi IPOs exhibit a significant decline in the post‐IPO performance compared to the pre‐IPO level as measured by the return on assets and return on sales. It was also found that the performance deterioration is associated with the IPO event.
Originality/value
The paper is the first assessment of IPOs clustering occurred in Saudi Arabia.
Keywords
Citation
Alanazi, A.S., Liu, B. and Forster, J. (2011), "The financial performance of Saudi Arabian IPOs", International Journal of Islamic and Middle Eastern Finance and Management, Vol. 4 No. 2, pp. 146-157. https://doi.org/10.1108/17538391111144533
Publisher
:Emerald Group Publishing Limited
Copyright © 2011, Emerald Group Publishing Limited