e Information Content of Non-current Operating Assets in Capital Raising Prospectus

Companies can raise capital in order to provide the liquidity needed to develop activities and projects, and to do so, they are required to approve a capital raising prospectus. Investors consider stock returns to decide whether to participate in a corporate capital raising plan. There are several factors that affect stock returns, the study of which can be effective in predicting stock returns. Therefore, this research studied the response of investors to management forecasts of changes in non-current operating assets (CNCOA) resulting from capital raising. The population constitutes of the companies listed on Tehran Stock Exchange (TSE) or Iran Farabourse co; the sample was chosen using some criteria (702 firm-year). The hypotheses were examined by generalized least squares (GLS). The results show that management forecasts of changes in non-current operating assets in the capital raising prospectus have a significant inverse relationship with abnormal future stock return. Furthermore, all components of CNCOA have information content for the market followed by underreact ion.