Determinants of Going-Public Decision in an Emerging Market: Evidence from India
This study investigates the determinants of going-public decision of the Indian firms juxtaposing two related research issues: What ex-ante characteristics of going-public Indian firms differentiate them from those Indian firms that continue to remain private? What ex-post consequences of IPOs on firm characteristics influence their going-public decision? The analysis suggests that Indian firms go public to finance their growth, diversify owners’ risk, rebalance their capital structure, and bring down their borrowing rates.