FINA6000 Managing Finance: Carsales.com IPO Analysis and Performance

This report presents a financial analysis of the Carsales.com IPO, focusing on its performance in the Australian market. The analysis begins with an overview of the IPO, including the funds raised and the company's operations. The report then delves into the prospectus, detailing the purpose of the IPO and associated costs, such as legal, accounting, and underwriting expenses. A key aspect of the analysis involves examining the concept of IPO underpricing, discussing relevant theories and factors influencing it, and calculating the extent of underpricing for Carsales.com. The report also assesses the company's share price performance, including capital gains, risk and return, and dividend information, from 2009 to 2014. The findings are supported by academic literature on IPOs, costs, underpricing, and performance, providing a comprehensive view of the Carsales.com IPO's financial implications and market impact. The report concludes with a summary of the key findings and their significance.