Jurnal Valid

Initial Public Offering (IPO) is an activity performed as an alternative source of funding through an increase in equity of the company by way of public offering IPO. A phenomenon that occurs in the initial offering to the public is underpricing (low price). Underpricing is a condition in which the stock price at the time of the IPO lower than the secondary market stock price. The purpose of this study was to determine the effect of the variable Debt to equity ratio, Price to book value, Earnings per share, return on assets, age and size of the company the company either partially or simultaneously to underpricing. This study used secondary data obtained from the Indonesia Stock Exchange in 2007-2011. Data collection techniques used were documentation. With purposive sampling method was obtained by 75 companies that used as samples. This study uses multiple linear regression analysis. Partial regression analysis results indicate that the Debt to Equity Ratio, Earnings Per Share, Return on Assets, the Company Age and size of the company a significant effect on underpricing, while the price-to-book value had no significant effect on underpricing. Meanwhile, simultaneous regression results indicate that the variable Debt to Equity Ratio, Price to Book Value, Earnings Per Share, Return on Assets, the Company Age and size of company simultaneously significant effect on underpricing.

Keywords: Underpricing, Debt to Equity Ratio, Price to Book Value, Earnings Per Share, Return on Assets, the Company Age and size of company

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