The Role of Initial Return to Market Value and Entrepreneur
Ownership in Indonesia
DIAN INDRIANA HAPSARI, HERRY SUBAGYO
Faculty of Economics and Business, Dian Nuswantoro University
Jalan Nakula I No.5-11 Semarang
INDONESIA
Key-words: Initial return, Entrepreneur Ownership, Equity Market Value Balance, Initial Public Offering,
Stock Exchange, Share price
Received: August 26, 2021. Revised: June 24, 2022. Accepted: July 16, 2022. Published: September 5, 2022.
1 Introduction
Companies that decide to go public must offer their
first shares to the public, which is called an initial
public offering (IPO) through the Indonesia Stock
Exchange (IDX). However, not all companies can
issue new shares (or bonds) in the capital market.
The sale of the company's initial shares is carried out
through a mechanism of participation to the public
(going public) is an alternative to obtain new
funding sources that improve the company's
performance. Initial public offerings are an
important source of corporate funding. When it first
made its share offering to the capital market, the
thing that was faced by the company that was going
to go public was the determination of the share price
in the primary market.
Agreement between the underwriter and The
issuing market is determinis the share prince on the
primarly market, (Jogiyanto, 2007) and (Rashid et
al., 2016). To obtain maximum new funds, the issuer
wants a high share price. The other side, as an
underwriter, will try to reduce the initial share price,
to reduce the risk of failure in the fully committed
contract. In the contract model between the issuer
and the underwriter, there is a full commitment
agreement where the underwriter will be responsible
for repurchasing shares that are not sold out on the
primary market, (Jogiyanto, 2007). Furthermore, in
the secondary market, the rise and fall of share
prices are highly dependent on market mechanisms.
According to Rahim & Yong, (2010) it is a universal
phenomenon that occurs during the initial public
offering where the stock price increases on the
closing side of the first day of the secondary market.
The initial price is set through negotiations with
an underwriter. Companies set their offering prices,
through various considerations to achieve success in
their IPO process. The difference in interests
between issuers and investors in obtaining profits
from the opening and closing prices, investors want
underpricing because they get capital gains, but not
for issuers because they are not optimal in raising
funds (Rahim & Yong, 2010). The phenomenon of a
price increase is a positive signal that indicates that
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Abstract: Initial pricing is done through negotiations, the company sets the offering price to achieve success in
its IPO process. The difference in the ratio between the opening and closing prices is an initial return that can
provide capital gains for shareholders. The gap between informed and uninformed investors makes stock prices
a measure of market value for investors. The specific purpose of this research was conducted to determine the
of the proportion of share ownership by entrepreneur ownership on the market value of equity and on the initial
return. In addition, to determine the direct effect of the initial rate of return on market equity. As well as the
effect of Initial Return in mediating the relationship between entrepreneur ownership and market value of equity.
This research method is quantitative, with purposive sampling technique. While the data collection method used
is a survey. The object of this research consisted of 228 companies that did their first listing for the 2008-2017
period on the Indonesia Stock Exchange. This study uses a simple linear regression analysis by doing the
correlation test, F test, and t-test. The results of this research describe that all regression relationships have p
values which are below the significance level of 0.05. Meanwhile, the findings on the role of initial return as a
mediating variable made the value of the coefficient B decrease from 1.103 to 0.095. Thus it can be concluded
that all hypotheses are supported with a significant and positive influence. On the effect of initial return in the
relationship between entrepreneur ownership and market value, it has a significant effect with a partially
mediating role.
the initial public offering company has a probability
of future profits which can increase the market value
of the new company.
In this study, the authors cannot be separated
from several limitations, including the sample used
is limited to companies that make an early listing for
the 2008-2017 period on the Indonesia Stock
Exchange. This limitation may produce some
undesirable results in the research model.
1.1 Research Purposes
Determine the role of initial returns in the IPO
process on the Indonesia Stock Exchange was this
Study general objective . While for specific
purposes, this study was designed do determine :
1. The influence of the proportion of share
ownership by entrepreneur ownership on the
market value of equity
2. The influence of the proportion of share
ownership by entrepreneur ownership on
initial returns
3. The effect of the initial return rate on the
market value of equity
4. The effect of Initial Return in mediating the
relationship between entrepreneur ownership
and market value of equity
1.2 Practical Applicability
This study can be used by the investos and the
potential investors as an input in using initial returns
in the initial public offering process on the Indonesia
Stock Exchange. For academics, this study results is
expected to poviide input on issues related to the
early role of March Value and entrepreneur
ownership.
2 Literature Review
2.1 Information Asymmetry Theory
Ross, (1973) suggests the term Principal-agent
problem, which occurs when asymmetric
information is related to the agent's activities and
information. The main problem is the existence of
hidden action, then hidden information, in which
hidden action leads to deviant behavior (moral
hazard and hidden information that give rise to
adverse selection behavior, according to Ross in
Arifin, (2007). There is also a monopoly power
information model of investor banker hypotheses
Baron & Holmström, (1980). stated in this model
that underwriters have better and better information
about market conditions than issuers that have just
entered the market. According to He-feng, (2013) ,
good investors will guarantee the period before the
IPO and become a signal because their reputation
provides a credible alternative signal for the value of
the IPO.
2.2 Valuation Theory
The theory of valuation was introduced in 1912 by
Josef Kurschak, a mathematician from Hungary.
Later developed by Joseph E. Stiglitz, Stephen A.
Ross, Edward C. Prescott, and Robert C. Merton in
the year 1970 in finance. In financial science, value
is the value of the company which consist of
shareholder value and funfamental value. Market
value and firm value is base of firm value. While,
the stock market is base of market value. Valuation
is needed by investors in investing where the result
of the valuation is a comparison value with market
prices. Knowing the value of an asset and the factors
that affect the value of an asset is a prerequisite for
making business decisions.
The expectation to produce a high return of a
security is not easy, whereas in the investment
principle it is said that selling when the price of an
asset is high and buying when the price of an asset is
low. So to achieve that, investors strive to predict
and get profit (return) stocks by utilizing various
methods and techniques available. According to
Wafi et al., (2015) and Hong & Wu, (2016) there is
a fundamental approach and technical approach to
action.
Thus it can be said that the proportion of share
ownership by the old owner when IPO time and the
planned utilization of the proceeds from the IPO
funds for investment, is a signal for investors who
see it as an opportunity to gain an increase in profits
and the issuer wants a reasonable share price and
does not harm the company. So in this study, the
initial return is proposed as a mediator between the
role of entrepreneur ownership and the value of the
stock market in the initial public offering. Based on
the description above, there is a harmonious
relationship between the concept of the proportion of
share ownership withheld by the old owner
(ownership retention) and the initial return for
investment.
2.3 Empirical Overview
Previous research has been conducted on the
influence of the role of Initial Return to Market
Value and Entrepreneurial Ownership. In general,
the research is carried out by researchers from
academia and has been published in several online
journals. Several previous studies that were used as a
reference and as a comparison with current research
can be presented in table 1:
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Tabel 1. Previous Research
Nama
Judul Penelitian
Alat Analisis
Perbedaan
Taolin, M. L &
Babulu, N. L.
(2020)
Margin Of Share as
Mediating Variable
The Effect of
Entrepreneurial
Ownership on Initial
Stock Market Value
Path Analisis
(SEM Partial
Least Square)
The difference between
previous research and
research in this paper
lies in the analysis tool.
In addition, the
difference is in the
mediation variable,
namely using the
Margin of share
(capital gain).
Dewi et al., (2018)
Initial Return on Initial
Public Offering in
Indonesian Capital
Market
Uji One Sample
T-Test and
Multiple linear
regression
The difference between
previous research and
research in this paper
lies in one of the
analytical tools, namely
the One Sample T-Test.
In addition, the
difference is that it
does not use a
mediating variable.
Meanwhile, in previous
study, the dependent
variable is Initial
Return.
2.4 Hypothesis
2.4.1 The Relationship Between the Proportion of
Share Ownership (α) by Entrepreneur
Ownership and the Market Value of Equity
According to Leland & Pyle, (1977) positive
function of the proportion of the old owner share
ownership who brought company to the listing is the
meaning of the market value. The intuition behind
this theory is that entrepreneurs are willing to hold a
large proportion of ownership if they believe that the
prospects for the company are good enough.
Therefore, the hypothesis is that the proportion of
share ownership by entrepreneurs is a signal that has
a positive effect on the IPO value.
H1: The proportion of share ownership (α) by
entrepreneur ownership has a positive effect on the
market value of equity.
2.4.2 The Relationship Between the Proportion of
Share Ownership (α) by Entrepreneur
Ownership and Initial Returns
According to Frith and Liau-Tan (1998) in Sehgal &
Singh, (2008), the proportion of ownership by old
owners or entrepreneurs is a good signal for
investors. Likewise, when the share ownership of the
old owner or entrepreneur Cirillo et al., (2015) at the
time of the IPO, takes into account the proportion of
shares that will be sold at the initial public offering.
Concerning the hypothesis that the proportion of
share ownership (α) by entrepreneurs has a positive
effect on initial returns, it can be explained that the
greater the stock ratio by entrepreneurs, it indicates
that there are other information signals that
entrepreneurs have. So that it can be predicted that
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the amount of the proceeds to the IPO Investment in
a company that conducts an initial public offering is
a reflection of the issuer's objective of conducting an
IPO.
H2: The proportion of share ownership (α) by
entrepreneur ownership has a positive effect on
Initial Return.
2.4.3 The level of Initial Return has a Positive
Effect on the Market Value of Equity
Komenkul & Siriwattanakul, (2016) research utilizes
the initial return measurement which is the
difference between the closing price on the first day
of trading and the initial selling price (offer price)
divided by the initial sale price (offer price). In
Taolin & Babulu, (2020) research results, the ratio
of this calculation provides a return on capital
(capital gain) to investors. The greater the capital
gain obtained by shareholders, the impact on the
appreciation of the equity market price will increase
positively. When an increase in profit from the
initial return in company performance will further
increase investor confidence in the management and
future of the company, shareholders will be more
willing to buy new shares in the stock market.
Therefore, the hypothesis is that the initial return
rate has a positive effect on the market value of
equity.
H3: The level of Initial Return has a positive effect
on the market value of equity.
2.4.3 The Relationship Between the Proportion of
Share Ownership (α) by Entrepreneur
Ownership, Initial Return, and Equity Market
Value
The results of research by Fan, (2007) found that
company performance in the primarly maket and
initial return has affected postively on share
ownership by old owner. It can be said in this
context, that the market value can be increase by the
management and the old owner (interpreneurs) by
his shares. Alanazi et al., (2011) stated that
performance of IPO companies affected positively
by the entrepreneurs ownership. On the other hand,
when the IPO Proceeds, the investment from the sale
of the initial shares is utilized maximally by the
issuer to increase the market value of the initial
shares. So it can be concluded that the Investment
Margin which contains the Proceeds of the
Investmen IPO and the initial return mediates the
relationship between f entrepreneur ownership and
the market value of the Initial Stock Market.
H4: Initial Return mediates the relationship between
entrepreneur ownership and the market value of
equity.
3 Methods
Quantitavie secondary data is used in this study,
namely data that represented by numbers indicating
the value of the variable under study. Data of this
study is obtained from:
1. Indonesian Capital Market Directory (ICMD)
from 2009 to 2018.
2. IDX Data Base via the internet (www.idx.co.id)
3. Prospectus of listed companies that made initial
public offerings in the 2009-2018 period. The
company's annual report was selected as the
sample in the 2009 to 2018 research years.
This study is time series and cross sectional
(pooled data). Because, the data category is based on
time sequence and time dimension.
According to Ferdinand, (2006), the
combination of all elements in the form of people,
things, or events who have similar characteristic that
became the study center of attention because it is
seen as the study universe is called population. This
study population includes all companies that did
initial registration on the Stock Exchange for 10
(ten) from 2009 to 2018.
The purpose of the sample selection is
researcher may have understood that the information
needed can be obtained from a certain target group
who is able to provide the desired information. It is
because the certain criteria that determined by
researcher ca be found on sample (Ferdinand, 2006).
The sample criteria used in the study are as follows:
1) There are a total of 228 sample companies from
228 companies that did their first listing for the
2008-2017 period on the Indonesia Stock
Exchange and were not delisted from 2008 to
2017,
2) Companies that regularly present and publish
financial reports in succession from 2009 to
2017.
Companies that are always and consistently not
included in the blacklist of the Indonesia Stock
Exchange during the research period.
Data collection is done by taking secondary data
available in the prospectus of issuers that conduct
initial public offerings, financial reports, annual
reports, and other types of reports issued by
companies either through the IDX, Indonesian
Capital Market Directory. (ICMD), Yahoo finance,
Bloomberg, Capital Market Reference Center
(PRPM), and statistics and through relevant
publication media. The survey method is used to
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collect data on the ownership structure and share
price as well as market value and performance of the
issuers in the form of prospectuses and financial
reports.
The market value of the company is the
dependent variable which is the total market value of
the issued and paid-up shares, which is based on the
closing price of the first day of listing on the IDX.
The market value of the company (V) must be
divided by the book value of the company's net
assets (NK) because it must be adjusted to the firm
size. The formula for measuring firm value is: Total
shares x closing price on the first day of listing /
book value of the company's net assets.
Initial investment returns, in this case
(Komenkul & Siriwattanakul, 2016) take advantage
of the initial return measurement which is the
difference between the initial selling price (offer
price) divided by the initial selling price ( offer
price) and the closing price on the first day of
trading This can be explained further by a formula:
In this case:
IRi is the Initial return
Pil is closing price on the first day
Pi0 is an offer price
The proportion of the entrepreneur's shares after
the IPO becomes a measure of ownership retention
(Djerbi & Anis, 2015). The number of shares of
entrepreneurs is measured by looking at the number
of shares before the offering period minus the
number of shares during the offering period then
divided by the completion of the offering period, this
method is carried out in research (Fan, 2007). Then
the following formula can explaine it: The formula
for ownership held by the entrepreneur by, Li et al.,
(2005) and Chen et al., (2015): Number of shares
held by old owners (pre IPO) / Total shares (post
IPO).
4 Results and Discussions
4.1 Hypothesis Test Model I
Simple Linear Regression Analysis the Relationship
Between Entrepreneur Ownership and Market
Value. The written R value is a representation of the
correlation test results. The correlation vakue of
0.323 is shown by the hypothesis test in model II
below. The correlation value is classified as weak in
relation to research variables. The value of R Square
is written in this table obtained from the test results
of the coefficient of determination. The view of
Ghozali (2016) says that testing the coefficient of
determination aims to measure the ability of the
model to explain how influential the independent
variables simultaneously on the dependent variable
is indicated by the adjusted R value. dependent is
very limited. In addition, if the number is close to 1
in the coefficient of determination, it means that the
independent variables have the ability to provide all
the information needed to predict the dependent
variable. A value of 10.4% is obtained for the
coefficient of determination. This means that the
effect of 10.4% is given by the independent variable
to variable Y. The remaining 89.6% is the influence
of other variables.
Table 2. Correlation Test Table
Getting the significance level is obtained
through the F test with its conditions. The way the
conditions are obtained is if the Sig test is obtained
<0.05. So that linearity is obtained in the regression
model. In this research, the sig value in Table 3 =
0.008. So this regression model can be said to be
significant, this means that there is linearity in the
regression model.
Table 3. Model Feasibility Test Results (Test F)
In the Unstandardized Coefficients B column,
the results of the variable coefficients and constant
coefficients are written which are information for the
regression model in a T test. This regression model
is described in the table below with the equation
formula Y = 1,831 + 1,103 X that is:
Model Summary
.323
a
.104
.090
.83257
Model
1
R
R Square
Adjusted
R Square
Std. Error of
the Estimate
Predictors: (Constant), Enterpreneur Ownership
a.
ANOVA
b
5.160
1
5.160
7.445
.008
a
44.363
64
.693
49.523
65
Regression
Residual
Total
Model
1
Sum of
Squares
df
Mean Square
F
Sig.
Predictors: (Constant), Enterpreneur Ownership
a.
Dependent Variable: Nilai Pasar
b.
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1. The constant value is 1.831, meaning that there is
a unidirectional effect of the entrepreneurial
ownership variables on the market value. This
shows that if all the independent variables are 0
percent or have not changed, then the market value
is 1.831.
2. The regression coefficient of the entrepreneur
ownership variable is 1.103. This value shows the
meaning that the entrepreneur ownership variable
has a direct effect on market value. This means
that if the entrepreneur ownership variable
increases by 1%, then the market value variable
will increase by 1,103. However, assuming that
the other variables are constant.
Table 4. Regression Coefficient Test Results (t-test)
4.2. Hypothesis Test Model II
Simple Linear Regression Analysis the Relationship
Between Entrepreneur Ownership and Initial Return.
The written R value is a representation of the
correlation test results. The correlation vakue of 0.178
is shown by the hypothesis test in model II below. The
correlation value is classified as weak in relation to
research variables. The value of R Square is written in
this table obtained from the test results of the
coefficient of determination. The view of Ghozali
(2016) says that testing the coefficient of
determination aims to measure the ability of the
model to explain how influential the independent
variables simultaneously on the dependent variable is
indicated by the adjusted R value. dependent is very
limited. In addition, if the number is close to 1 in the
coefficient of determination, it means that the
independent variables have the ability to provide all
the information needed to predict the dependent
variable. A value of 3.2% is obtained for the
coefficient of determination. This means that the
effect of 3.2% is given by the independent variable to
variable Y. The remaining 96.8% is the influence of
other variables.
Table 5. Correlation Test Table
Getting the significance level is obtained through
the F test with its conditions. The way the conditions
are obtained is if the Sig test is obtained <0.05. So that
linearity is obtained in the regression model. In this
research, the sig value in Table 6 = 0.015. So this
regression model can be said to be significant, this
means that there is linearity in the regression model.
Table 6. Model Feasibility Test Results (Test F)
In the Unstandardized Coefficients B column, the
results of the variable coefficients and constant
coefficients are written which are information for the
regression model in a T test. This regression model is
described in the table below with the equation formula
Y = 0,137 + 0,286 X that is:
1. The constant value is 0,137, meaning that there
is a unidirectional effect of the entrepreneurial
ownership variables on the initial return. This
Coefficients
a
1.831
.133
13.772
.000
1.103
.404
.323
2.728
.008
(Constant)
Enterpreneur Ownership
Model
1
B
Std. Error
Unstandardized
Coeff icients
Beta
Standardized
Coeff icients
t
Sig.
Dependent Variable: Nilai Pasar
a.
Model Summary
.178
a
.032
.016
.40836
Model
1
R
R Square
Adjusted
R Square
Std. Error of
the Estimate
Predictors: (Constant), Enterpreneur Ownership
a.
ANOVA
b
.348
1
.348
2.086
.015
a
10.673
64
.167
11.021
65
Regression
Residual
Total
Model
1
Sum of
Squares
df
Mean Square
F
Sig.
Predictors: (Constant), Enterpreneur Ownership
a.
Dependent Variable: Initial Return
b.
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shows that if all the independent variables are 0
percent or have not changed, then the initial
return is 0,137.
2. The regression coefficient of the entrepreneur
ownership variable is 0.286. This value shows the
meaning that the entrepreneur ownership variable
has a direct effect on initial return. This means that
if the entrepreneur ownership variable increases by
1%, then the initial return variable will increase by
0.286. However, assuming that the other variables
are constant.
Table 7. Regression Coefficient Test Results (t-test)
4.3 Hypothesis Test Model III
Simple Linear Regression Analysis the Relationship
Between Initial Return and Maket Value. The
written R value is a representation of the correlation
test results. The correlation vakue of 0.295 is shown
by the hypothesis test in model II below. The
correlation value is classified as weak in relation to
research variables. The value of R Square is written
in this table obtained from the test results of the
coefficient of determination. The view of Ghozali
(2016) says that testing the coefficient of
determination aims to measure the ability of the
model to explain how influential the independent
variables simultaneously on the dependent variable
is indicated by the adjusted R value. dependent is
very limited. In addition, if the number is close to 1
in the coefficient of determination, it means that the
independent variables have the ability to provide all
the information needed to predict the dependent
variable. A value of 0.87% is obtained for the
coefficient of determination. This means that the
effect of 0.87% is given by the independent variable
to variable Y. The remaining 91.3% is the influence
of other variables.
Table 8. Correlation Test Table
Getting the significance level is obtained
through the F test with its conditions. The way the
conditions are obtained is if the Sig test is obtained
<0.05. So that linearity is obtained in the regression
model. In this research, the sig value in Table 9 =
0.016. So this regression model can be said to be
significant, this means that there is linearity in the
regression model.
Table 9. Model Feasibility Test (Test F)
In the Unstandardized Coefficients B column, the
results of the variable coefficients and constant
coefficients are written which are information for the
regression model in a T test. This regression model is
described in the table below with the equation formula
Y = 1.552 + 0.624 X that is:
1. The constant value is 1.552, meaning that there
is a unidirectional effect of the initial return
variables on the market value. This shows that if
all the independent variables are 0 percent or
have not changed, then the market value is
1.552.
2. The regression coefficient of the initial return
variable is 0.624. This value shows the meaning
that the initial return variable has a direct effect
on market value. This means that if the initial
return variable increases by 1%, then the market
Coefficients
a
.137
.065
2.103
.039
.286
.198
.178
1.444
.015
(Constant)
Enterpreneur Ownership
Model
1
B
Std. Error
Unstandardized
Coeff icients
Beta
Standardized
Coeff icients
t
Sig.
Dependent Variable: Initial Return
a.
Model Summary
.295
a
.087
.072
.84064
Model
1
R
R Square
Adjusted
R Square
Std. Error of
the Estimate
Predictors: (Constant), Initial Return
a.
ANOVA
b
4.296
1
4.296
6.079
.016
a
45.227
64
.707
49.523
65
Regression
Residual
Total
Model
1
Sum of
Squares
df
Mean Square
F
Sig.
Predictors: (Constant), Initial Return
a.
Dependent Variable: Nilai Pasar
b.
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value variable will increase by 0.624. However, assuming that the other variables are constant.
Table 10. Regression Coefficient Test Results (t-test)
4.4 Hypothesis Test Model IV
Simple Linear Regression Analysis the Role of Initial
Return Mediation on the relationship between
Entrepreneur Ownership and Maket Value. The
written R value is a representation of the correlation
test results. The correlation vakue of 0.403 is shown
by the hypothesis test in model II below. The
correlation value is classified as weak in relation to
research variables. The value of R Square is written
in this table obtained from the test results of the
coefficient of determination. The view of Ghozali
(2016) says that testing the coefficient of
determination aims to measure the ability of the
model to explain how influential the independent
variables simultaneously on the dependent variable is
indicated by the adjusted R value. dependent is very
limited. In addition, if the number is close to 1 in the
coefficient of determination, it means that the
independent variables have the ability to provide all
the information needed to predict the dependent
variable. A value of 16.2% is obtained for the
coefficient of determination. This is significant,
namely the effect of 16.2% given by the mediating
variable (M) to variables X and Y. The remaining
96.8% is the influence of other variables.
Table 1. Correlation Test Table
Getting the significance level is obtained through
the F test with its conditions. The way the conditions
are obtained is if the Sig test is obtained <0.05. So
that linearity is obtained in the regression model. In
this research, the sig value in Table 12 = 0.004. So
this regression model can be said to be significant,
this means that there is linearity in the regression
model.
Table 2. Model Feasibility Test Results (Test F)
In the Unstandardized Coefficients B column, the
results of the variable coefficients and constant
coefficients are written which are information for the
regression model in a T test. This regression model is
described in the table below with the equation formula
Y = 1.760 + 0.095 X + 0.519 M that is:
1. The constant value is 1.760, meaning that there
is a unidirectional effect of the entrepreneurial
ownership and initial return variables on the
market value. This shows that if all the
independent variables are 0 percent or have not
changed, then the market value is 1.760.
Coefficients
a
1.552
.105
14.736
.000
.624
.253
.295
2.466
.016
(Constant)
Initial Return
Model
1
B
Std. Error
Unstandardized
Coeff icients
Beta
Standardized
Coeff icients
t
Sig.
Dependent Variable: Nilai Pasar
a.
Model Summary
.403
a
.162
.136
.81148
Model
1
R
R Square
Adjusted
R Square
Std. Error of
the Estimate
Predictors: (Constant), Enterpreneur Ownership, Initial
Return
a.
ANOVA
b
8.037
2
4.018
6.102
.004
a
41.486
63
.659
49.523
65
Regression
Residual
Total
Model
1
Sum of
Squares
df
Mean Square
F
Sig.
Predictors: (Constant), Enterpreneur Ownership, Initial Return
a.
Dependent Variable: Nilai Pasar
b.
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2. The regression coefficient of the enterpreneur
ownership variabel (X) is 0.095. This value
shows the meaning that the entrepreneur
ownership variable has a direct effect on market
value. This means that if the entrepreneur
ownership variable increases by 1%, then the
market value variable will increase by 0.095.
However, assuming that the other variables are
constant.
3. The regression coefficient of the initial return
variabel (M) is 0.519. This value shows the
meaning that the initial return variable mediates
the effect of Entrepeneur Ownership on the
market value. This means that if the initial
return variable increases by 1%, then the market
value variable will increase by 0.519. However,
assuming that the other variables are constant.
Table 3. Regression Coefficient Test Results (t-test)
5 Discussion
On the basis of managing the result data through
SPSS, the Interpretation of the Analysis Results is
obtained which is shown in the table below:
Table 14. Linear Regression Test Results
Regression
relationship
Explanatory
variable
The
coefficient of
determination
Regression model
significance test
Regression
coefficient
significance
test
F
P
B
t
p
Entrepreneursh
ip ownership
and market
value
Enterpreneur
ownership
0,104
7,445
0,008*
1,103
2,728
0,008*
Enterpreneur
ownership and
Initial return
Enterpreneur
ownership
0,032
2,086
0,015*
0,286
1,444
0,015*
Initial return
and Market
value
Initial return
0,087
6,074
0,016*
0,624
2,466
0,016*
The mediating
role of Initial
returns on the
relationship
between
entrepreneurshi
p and market
value
Enterpreneur
ownership
0,136
6,102
0,004*
0,095
2,384
0,020*
Market value
0,519
2,090
0,041*
Information: *= significant at the level of significance 0,05
Coefficients
a
1.760
.134
13.135
.000
.519
.248
.245
2.090
.041
.095
.400
.028
2.384
.020
(Constant)
Initial Return
Enterpreneur Ownership
Model
1
B
Std. Error
Unstandardized
Coeff icients
Beta
Standardized
Coeff icients
t
Sig.
Dependent Variable: Nilai Pasar
a.
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Table 5.1 explains that the relationship between
entrepreneurship ownership and market value is
positive and significant (B = 1.103; p = 0.08 *).
Then hypothesis one is supported. The relationship
between entrepreneur ownership and initial returns
is positive and significant (B = 0.286; p = 0.015 *).
Then hypothesis two is supported. The mediating
role of initial returns in the relationship between
entrepreneurial ownership and market value requires
that the three pathways in the model above are all
significant. If in multiple regression the effect of
entrepreneurial ownership and initial returns on
market value: If entrepreneurial ownership becomes
insignificant, then the initial return is full mediation.
If entrepreneurial ownership remains significant, but
the coefficient B decreases, then the initial return is
partially mediated.
6 Conclusions
On the basis of the elaboration of the results and
discussion, so that the conclusions that can be drawn
are:
1. All relationships between constructs in the
model are significant (conditions for mediation)
2. After the initial return is included in multiple
regression, the effect of entrepreneurship
ownership remains significant, but the B
coefficient decreases (from 1.103 to 0.095). So,
it can be concluded that the initial return
partially mediates the relationship between
entrepreneurship ownership and market value.
Then hypothesis three is supported.
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