Can social media sentiment and other non financial factors burning IPO prices?

Abstract

This research aims to see whether social media, company size and company age influence IPO prices that overpricing. This research involved 460 IPO companies on the IDX from 2013 to 2023. Seventy companies were selected as samples using "purposive sampling". This analysis uses multiple linear regression. This research uses various metrics, namely social media promotion score, total assets, and years between founding and IPO to assess the impact of social media, company size, and company age on overpricing. IPO overpricing is positively influenced by social media according to this research. Company size and age have nothing to do with IPO overpricing. The implications are important for investors in making investment decisions, allowing them to consider social media aspects as one of the factors influencing initial share valuation. Meanwhile, for academics, this study is an addition to the literature regarding initial stock overpricing. This research is expected to provide useful insights for considering important aspects of investment and issues related to IPOs.