Journal Press India®

Determinants of Firm’s Performance: An Empirical Evidence from India

Vol 6, Issue 1, January - June 2019 | Pages: 80-97 | Research Paper  

 
Article has been added to the cart.View Cart (0)
https://doi.org/10.17492/pragati.v6i1.184298


Author Details ( * ) denotes Corresponding author

1. * Ranjeet Kumar Mishra, Research Scholar, Patna University, Patna, Bihar, India (learnindialeadindia@yahoo.com)

Objective of this study is to empirically examine the factors which boost or hurt the performance of a firm. For the fulfilment of this objective impact of forty three variables on seven proxies of firm’s performance are investigated in this study. Out of the seven proxies of firm’s performance six are related to accounting measure and one is related to value measure of performance. Unbalanced panel data for the periods of 2009-10 to 2016-17 related to 143 listed Indian companies from 14 manufacturing industries are used. Data is analysed through pooled ordinary least square regression. Findings show the combined impact i.e. positive or negative or insignificant impact of these variables on firm’s performance.

Keywords

Firm’s performance; Tobin Q; Net trade cycle; Capital structure; Working capital management; Macroeconomic factors

  1. Abor, J. (2005). The effect of capital structure on profitability: an empirical analysis of listed firms in Ghana. The Journal of Risk and Finance, 6(5), 438-445.
  2. Adams, R.B. & Ferreira, D. (2008). Women in the boardroom and their impact on governance and performance. Working paper, Centre for Economic Institutions, Working paper series no. 2008-7.
  3. Adams, R. B. & Mehran, H. (2012). Bank board structure and performance: Evidence for large bank holding companies. Journal of Financial Intermediation, 21(2), 243-267.
  4. Ahmad, Z., Abdullah, N.M.H. & Roslan, S. (2012). Capital structure effect on firms performance: Focusing on consumers and industrials sectors on Malaysian firms. International Review of Business Research Papers, 8(5), 137-155.
  5. Arora, A. & Sharma, C. (2016). Corporate governance and firm performance in developing countries: Evidence from India. Corporate Governance, 16(2), 420-436.
  6. Awais, M. (2016). Impact of capital structure on the firm performance: Comprehensive study of Karachi stock exchange. Science International, 28(1), 501-507.
  7. Berkman, H. (2003). The effect of board composition and ownership structure on firm performance: Evidence from India. Proceedings of China International Conference in Finance held July 5-7, 2005 in Kunming, PRC.
  8. Deloof, M. (2003). Does working capital management affect profitability of Belgian firms? Journal of Business Finance & Accounting, 30(3&4), 573-587.
  9. Dhar, S., Kovid, R.K. & Dharwal, M. (2018). Corporate governance, related party transactions and firm performance: A panel data analysis. MUDRA: Journal of Finance and Accounting, 5(2), 1-13.
  10. Douma, S., George, R. & Kabir, R. (2006). Foreign and domestic ownership, business groups, and firm performance: Evidence from a large emerging market. Strategic Management Journal, 27(7), 637-657.
  11. Fich, E.M. & Shivdasani, A. (2006). Are busy boards effective monitors? The Journal of Finance, 61(2), 689-724.
  12. Garcia, J.F.L., Martins, D.F.V. & Brandao, D.E. (2011). The impact of working capital management upon companies’ profitability: Evidence from European companies. Working paper, The School of Economics of Porto University, Portugal, Working paper series no. 438. 
  13. Garcia-Teurel, P., & Martinez-Solano, P. (2007). Effects of working capital management on SME profitability. International Journal of Managerial Finance, 3(2), 164177.
  14. Gaur, A.S. & Kumar, V. (2009). International diversification, business group affiliation and firm performance: Empirical evidence from India. British Journal of Management, 20(2), 172-186.
  15. Ghosh, S. (2007). Board diligence, director busyness and corporate governance: An empirical analysis for India. Review of Applied Economics, 3(1-2), 91-104.
  16. Ghosh, S. (2008). Leverage, foreign borrowing and corporate performance: Firm-level evidence for India. Applied Economics Letters, 15(8-9), 607-616.
  17. Gill, A., Biger, N. & Mathur, N. (2010). The relationship between working capital management and profitability: Evidence from the United States. Business and Economics Journal, 10(1), 1-9.
  18. Habib, H.J., Khan, F. & Wazir, M. I. (2016). Impact of debt on profitability of firms: Evidence from non-financial sector of Pakistan. City University Research Journal, 6(1), 70-80.
  19. Haldar, A., Shah, R. & Rao, S.V.D.N. (2015). Gender diversity in large listed Indian companies. Corporate Ownership & Control, 12(3), 573-580.
  20. Haniffa, R. & Hudaib, M. (2006). Corporate governance structure and performance of Malaysian listed companies. Journal of Business Finance & Accounting, 33(7 & 8), 1034-1062.
  21. Horvath, R. & Spirollari, P. (2012). Do the board of directors’ characteristics influence firm’s performance? The U.S. evidence. Prague Economic Papers, 21(4), 470-486.
  22. Jackling, B. & Johl, S. (2009). Board structure and firm performance: Evidence from India’s top companies. Corporate Governance: An International Review, 17(4), 492-509.
  23. Kakani, R.K., Saha, B., & Reddy, V.N. (2001). Determinants of financial performance of Indian corporate sector in the post-liberalization era: An exploratory study. Working paper, NSE Research Initiative, Working paper series no 5.
  24. Kalsie, A. & Shrivastav, S.M. (2016). Analysis of board size and firm performance: Evidence from NSE companies using panel data approach. Indian Journal of Corporate Governance, 9(2), 148-172.
  25. Kar, R.N., Soni, A. & Singh, C.K. (2014). Assessing the impact of mergers and acquisitions on firm performance: Evidence from India. Focus: Journal of International Business, 1(1), 39-67.
  26. Kathuria, V. & Dash, S. (1999). Board size and corporate financial performance: An investigation. Vikalpa, 24(3), 11-17.
  27. Kaur, M. & Vij, M. (2017). Board characteristics and firm performance: Evidence from banking industry in India. Asian Journal of Accounting and Governance, 8(1), 39-53.
  28. Khanna, T. & Palepu, K. (1999). Emerging market business groups, foreign intermediaries, and corporate governance. Working paper, National Bureau of Economic Research, Working paper series No-6955.
  29. Kumar, S. (2015). The significance of working capital management and its components on SMES performance - evidence from India. Proceeding of 16th International Academic Conference (12-15 May 2015), International Institute of Social  and Economic Sciences,  Amsterdam., Czech Republic.
  30. Kumar, A., Sinha, A., Arora, A., & Aggarwal, A. (2018). Impact of CSR activities on the financial performance of firms. MUDRA: Journal of Finance and Accounting, 5(1), 75-89.
  31. Lazaridis, I., & Tryfonidis, D. (2006). Relationship between working capital management and profitability of listed companies in the Athens Stock Exchange. Journal of Financial Management and Analysis, 19(1), 26-35.
  32. Majumdar, S. K. (1997). The impact of size and age on firm-level performance: Some evidence from India. Review of Industrial Organization, 12(2), 231-241.
  33. Manna, A., Sahu, T.N. & Gupta, A. (2016). Impact of ownership structure and board composition on corporate performance in Indian companies. Indian Journal of Corporate Governance, 9(1), 44-66.
  34. Mathuva, D.M. (2010). The influence of working capital management components on corporate profitability: A survey on Kenyan listed firms. Research Journal of Business Management, 4(1), 1-11.
  35. Mirza, S. A. & Javed, A. (2013). Determinants of financial performance of a firm: Case of Pakistani stock market. Journal of Economics and International Finance, 5(2), 43-52.
  36. Padachi, K. (2006). Trends in working capital management and its impact on firm’s performance: An analysis of Mauritian small manufacturing firms. International Review of Business research papers, 2(2), 45-58.
  37. Pant, M. & Pattanayak, M. (2007). Insider ownership and firm value: Evidence from Indian corporate sector. Economic and Political Weekly, 42(16), 1459-1467.
  38. Raheman, A. & Nasr, M. (2007). Working capital management and profitability-case of Pakistani firms. International Review of Business Research Papers, 3(1), 279-300.
  39. Ramdani, D. & Witteloostuijn, A. (2010). The impact of board independence and CEO duality on firm performance: A quantile regression analysis for Indonesia, Malaysia, South Korea and Thailand. British Journal of Management, 21(3), 607-626.
  40. Rashid, A. (2010). Board composition and firm performance: Evidence from Bangladesh. Australasian Accounting, Business and Finance Journal, 4(1), 76-95.
  41. Salim, M. & Yadav, R. (2012). Capital structure and firm performance: Evidence from Malaysian listed companies. Procedia - Social and Behavioral Sciences, 65(1), 156-166.
  42. Yermack, D. (1996). Higher market valuation of companies with a small board of directors. Journal of Financial Economics, 40(2), 185-211.
Abstract Views: 426
PDF Views: 25

Advanced Search

News/Events

Indira Institute of ...

Indira Institute of Management, Pune Organizing International Confe...

D. Y. Patil Internat...

D. Y. Patil International University, Akurdi-Pune Organizing Nation...

ISBM College of Engi...

ISBM College of Engineering, Pune Organizing International Conferen...

Periyar Maniammai In...

Department of Commerce Periyar Maniammai Institute of Science &...

Institute of Managem...

Vivekanand Education Society's Institute of Management Studies ...

Institute of Managem...

Deccan Education Society Institute of Management Development and Re...

S.B. Patil Institute...

Pimpri Chinchwad Education Trust's S.B. Patil Institute of Mana...

D. Y. Patil IMCAM, A...

D. Y. Patil Institute of Master of Computer Applications & Managem...

Vignana Jyothi Insti...

Vignana Jyothi Institute of Management International Conference on ...

Department of Commer...

Department of Commerce, Faculty of Commerce & Business, University...

By continuing to use this website, you consent to the use of cookies in accordance with our Cookie Policy.