External Determinants of Going Public in the Czech Republic and in Poland

This study deals with Initial Public Offering (IPO) developments in the Czech Republic and Poland over the period 2000 – 2012 and aims to indicate the influence of external going public determinants, in particular the capital market size- and liquidity- indicators, on IPO numbers and values. Our sample includes enterprises that conducted an IPO on the main markets of the Prague and Warsaw Stock Exchanges. The following steps were undertaken to analyse the quantitative data. Firstly, we performed a quantitative analysis of the Czech and Polish capital market in order to draw attention to certain specific issues existing on these markets between 2000 and 2012. Next, we compared internal IPO characteristics on the particular capital markets with the empirical evidence on IPOs in the Central and Eastern Europe- and EU-wide capital markets. Our results indicate the favourable development of fundamental capital market indicators on the Warsaw Stock Exchange. This could be seen as a signal of increasing market attractiveness for both investors and potential issuers (IPO candidates) and thereby accelerate IPO activity. On the other hand, the size and liquidity of the Czech capital market still represents an investment barrier.