Going public is one of the most common forms of equity financing used by
firms to raise funds in order to finance their current and future operations. As
part of this, firms become listed on a Stock Exchange so their shares become
publicly traded. Being a publicly listed company comes with several benefits
and obligations. In as much as firms are prone to some cost and obligations
after listing, the bottom line for any firm that goes public is to obtain the
necessary capital and recognition to make them more profitable.
This study seeks to investigate whether there is a relationship between listing
on a Stock Exchange like that of Ghana`s and profitability. It focuses mainly
on the financial stocks listed on the Ghana Stock Exchange and examines pre
and post listing performance of these financial firms. It uses panel data
regression analysis to deduce the relationship between Going Public and
profitability. It also looks at factors that affect profitability of firms after
Going Public in the Ghanaian context.
The paper concludes that there is positive relationship between going public
and profitability. However, this relationship is not statistically significant. This
means firms do not necessarily become profitable after going public.
Nevertheless, there was a statistically significant positive relationship
between assets of firms and profit margins. Recommendations made were
managing and increasing asset base of firms to make them profitable and
improving standards and regulations in various industries to enhance
performance of firms.
CDR, C (2021). THE EFFECT OF GOING PUBLIC ON PROFITABILITY OF FINANCIAL FIRMS LISTED ON THE GHANA STOCK EXCHANGE. Afribary.com: Retrieved April 11, 2021, from https://afribary.com/works/the-effect-of-going-public-on-profitability-of-financial-firms-listed-on-the-ghana-stock-exchange
Coalition, CDR. "THE EFFECT OF GOING PUBLIC ON PROFITABILITY OF FINANCIAL FIRMS LISTED ON THE GHANA STOCK EXCHANGE" Afribary.com. Afribary.com, 02 Apr. 2021, https://afribary.com/works/the-effect-of-going-public-on-profitability-of-financial-firms-listed-on-the-ghana-stock-exchange . Accessed 11 Apr. 2021.
Coalition, CDR. "THE EFFECT OF GOING PUBLIC ON PROFITABILITY OF FINANCIAL FIRMS LISTED ON THE GHANA STOCK EXCHANGE". Afribary.com, Afribary.com, 02 Apr. 2021. Web. 11 Apr. 2021. < https://afribary.com/works/the-effect-of-going-public-on-profitability-of-financial-firms-listed-on-the-ghana-stock-exchange >.
Coalition, CDR. "THE EFFECT OF GOING PUBLIC ON PROFITABILITY OF FINANCIAL FIRMS LISTED ON THE GHANA STOCK EXCHANGE" Afribary.com (2021). Accessed April 11, 2021. https://afribary.com/works/the-effect-of-going-public-on-profitability-of-financial-firms-listed-on-the-ghana-stock-exchange