An Analysis of Short-Term IPO Price Performance on Borsa Istanbul (2021–2023)

Abstract

Purpose – This study examines the short-term price performance of firms that went public on Borsa Istanbul (BIST) between 2021 and 2023 and identifies the factors influencing this performance. The main objective is to test the existence of the underpricing phenomenon in BIST and analyze firm, offering, and market-related variables affecting short-term returns.
Design/methodology/approach – The short-term price performance of IPO firms was analyzed using the One-Sample Wilcoxon Signed-Rank Test to determine whether raw returns were positive on the first trading day and over 5, 15, 30, and 60-day periods, and whether they provided statistically significant abnormal returns exceeding benchmark BIST 100 index. The variables affecting performance were grouped based on prospectus information, K-Means clustering algorithms, and median values. Statistical differences in returns across variable-based groupings were assessed using the Kruskal-Wallis and Mann-Whitney U tests.
Results – The short-term price performance of firms was analyzed using the One-Sample Wilcoxon Signed-Rank Test to determine whether the 1, 5, 15, 30, and 60 day returns differed significantly from the BIST 100 index. Variables affecting performance were grouped based on prospectus data, the k-means clustering algorithm, and median values. Differences among these variable-based groups were examined using the Kruskal-Wallis and Mann-Whitney U tests
Discussion – The findings emphasize the importance of accurate pricing and strategic evaluation in IPO processes. This study offers a multidimensional empirical analysis of Borsa Istanbul’s recent IPO surge and provides an analytical perspective on short-term performance dynamics through a clustering approach. Its methodology and results are expected to contribute to the literature and serve as a decision-support tool for investors and regulators. Future research may apply machine learning to identify key determinants of IPO outcomes .