Evaluation of IPO offering price using patent document vectors

Abstract

There are many previous studies on IPO open prices. In particular, underpricing,where the public price is lower than the initial price, is an important issue from themanagement's point of view, as it causes loss of opportunity for issuers. Various hypothesesabout the cause of underpricing have been made by previous research. In this research, wefocus on the calculation of corporate value when determining the open price. Specifically,SCDV was created based on patent documents owned by the company. Next, a similarcompany comparison method was performed by selecting similar companies based on thecreated document vectors, and the validity of the open price was attempted.