Articles
Are We Ready for yet another Crisis: Institutional Liquidity Viability?

Megha Jain and Saurabh Jaiswal

, 2020

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The current liquidity fiasco is not anymore, a confidential matter. In view of the same, the current study is an attempt to investigate deeper in order to gain insights of the so-called liquidity crunch on key sectors in India such as Mutual Fund, Microfinance institution, Banking and the Corporate. The analysis indicates towards the grim fundamentals in the upcoming year(s). The silver lining shall be a combination of efforts from the central bank along with a fiscal boost in order to make the desired dent to a shiny future.

Foreign Direct Investment in Multi Brand Retail in India – An Interpretative Phenomenological Analysis

Chandra Shekhar Sharma and Sameer Lama

Volume 41, Issue 1(Jan- June) 2020

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Foreign Direct Investment in Multi Brand Retail has been a contentious issue both for the policy makers and the foreign investors who are willing to invest in India. Various stakeholders are baffled to assess the overall implication of FDI in Multi Brand Retail. The purpose of this phenomenological study is to examine the perceived implications of FDI in Multi Brand Retail in India for various stakeholders. To address the central research question if it makes a sense to open the door for foreign investors in multi brand retailing in India, the authors have adopted an interpretative phenomenological analysis methodology to examine the experiences of the various stakeholders associated with foreign direct investment in multi brand retailing in India. Analysis of 52 significant statements from a series of semi structured interviews revealed that FDI in Multi Brand Retail would lead to a number of economic and social problems in India. However, it was also revealed that FDI in Multi Brand Retail would improve the logistics and infrastructural prospects in both the rural and urban areas in India. People are still skeptic with the issue of employment generation or displacement but majority of the participants feel that some form of employment will be generated as a result of FDI in multi brand retailing. The political and administrative structure shall play a critical role for the reform to be successfully implemented in India. The study is the first of its kind in India and certainly the study would help the scholars from the academia and the policy makers to presuppose their argument on FDI in multi brand retailing in India.

Aspects of Returnee Emigrant Workers from the Gulf: An Empirical Study

Rajeev Kumar

Volume 41, Issue 1(Jan- June) 2020

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The paper explores the behavioural and other aspects of the returnee emigrants who worked for at least one year in any one of the six member countries of the Gulf Cooperation Council (United Arab Emirates, Saudi Arabia, Kuwait, Oman, and Bahrain and Qatar) in the last ten years. The paper is based upon a field survey conducted in nine districts of the Western Uttar Pradesh. Primary focus of the paper is on the decision of the returnee emigrants and their households in terms of remitting money while abroad, return and utilisation of remittance by their family. Apart from that the paper also tries to explore various other issues like financing of the initial cost of migration and occupational choices upon return.

Book Review of "The Business of Humanity: Strategic Management in the Era of Globalization, Innovation and Shared Value"

Annavajhula J.C. Bose

Volume 41, Issue 1(Jan- June) 2020

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This book has interested me a lot for heralding a transformation in capitalism away from being shareholder-centred to becoming human-centred. The authors have documented this emerging change on the basis of sound empirical evidence wedded to appealing inductive logic. There are companies which have strategically integrated “humaneness” into their value creation, and have shown better economic performance in the process. And there are also companies which have massively invested in emerging markets to meet the needs of impoverished people in large numbers by doing a rethink of products and services, technology, and marketing, and they too have shown better economic performance. In other words, these companies have considered and included “humankind” at the bottom of the pyramid.

HOLIDAY EFFECT IN SELECT ASIAN STOCK MARKETS

Anuradha Agarwal, Krishan Lal Dahiya and Poonam Gupta

Volume 40, Issue 2 (Jul - Dec)

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This study seeks to examine the existence of holiday effect in two Asian Stock Markets, Singapore and India. India and Singapore seem to have similar traditions. Many Hindus, being the citizen of Singapore celebrate Diwali and worship Buddhism, which was preached by King Siddhartha (then part of India). Keeping in mind this fact, the daily closing prices and stock returns are regressed to investigate the existence of pre-holiday and post-holiday effect in the two countries and during the common holidays from a period of 1992 to 2018. It was found that in both the countries the pre-holiday effect did not exist. It had been replaced by the post-holiday effect. Even though Singapore is developed, the post-holiday return was found to be significant in this country. Among the specific holidays, the New Year and the Good Friday could attract the attention of investors at 10% significance level in post-holiday period. As for India, none of the holidays but the trading days not-corresponding a holiday provided significant return at 10% level in post and pre-holiday analysis. The post-holiday effect was however found in the form New Year effect in India at 5% significance level. The Common holiday like Deepwali did not achieve the returns significant enough at 5% or 10% level, neither in the pre-holiday period nor in the post-holiday.

DYNAMIC LINKAGES BETWEEN US AND INDIAN EQUITY MARKETS: AN EMPIRICAL STUDY

Asha Rani and Sunaina Kanojia

Volume 40, Issue 2 (Jul - Dec)

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In this study, we attempt to investigate the dynamic linkages between US and Indian equity market particularly after the Global Financial Crisis. The daily closing value of total return indices from both the equity markets is examined for a period of more than 15 years ending March 2019. These indices are not found to be co-integrated. An analysis of returns from these equity markets using ADCC-GARCH model reveals the linkage between the volatilities of the two markets. However, the degree of these association between the volatilities are time-varying and has been found to have reduced for past three years paving the way for equity investors of both the markets for seeking the advantage of international diversification.

IMPACT OF MACRO ECONOMIC VARIABLES ON INDIA'S STOCK MARKET: A DYNAMIC OLS APPROACH

Rakesh Shahani and Bhavya Vashisth

Volume 40, Issue 2 (Jul - Dec)

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The present study makes an attempt to investigate the impact of India’s macroeconomic variables on the India’s flagship Stock Index: the NSE Nifty. The variables include monthly log transformed prices of the key macro variables viz. money supply, industrial production , rupee –dollar foreign exchange rate, Oil Price and Yield on Government Bonds. For financial variables, closing monthly prices of NSE Nifty, Oil Prices and rupee-dollar foreign exchange rate have been taken into consideration and analysis has carried out for a ten year period April 2008 to March 2018. For other macro variables we have taken closing value of their respective indices. The study employs Dynamic OLS technique of Stock and Watson (1993), a co-integration technique which corrects for simultaneity bias. To correct for the short run dynamics, an error corrective mechanism has also been established parsimoniously. Other tests included in the study are the Augmented Dickey Fuller for detection of unit root of variables and Causality tests between Nifty and each of the macro economic variables under study. The Dynamic OLS was carried out at optimal AIC Lag Identification criteria with maximum limit set at ‘3’ lags and ‘3’ leads. The Dynamic OLS was subject to parsimonious adjustment and the results showed that only three variables, CPI, Forex and Oil were having a co-integrating relation with the dependent variable NSE Nifty Prices. The Parsimonious ECM relation to determine the equilibrium link between short and long run and the results showed that lagged error term was significant and also negative with a figure of 0.51 thereby showing 51 % backward movement towards equilibrium in one period. The unit root diagnostic tests confirmed that time series of all the independent variables was stationary only at 1st difference with only NSE Nifty being stationary at level .

EMPIRICAL TESTING OF ARBITRAGE PRICING THEORY IN THE INDIAN STOCK MARKET: FACTOR ANALYSIS APPROACH

Shikha Menani and H.V. Jhamb

Volume 40, Issue 2 (Jul - Dec)

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Investors all over the world have been in search of a model that can help them in estimating the parity between risk and return relationship which paved the way for the models like CAPM, Conditional CAPM, multi factor CAPM model with different firm specific factors, Arbitrage Pricing Theory and various other modified versions of the same. The traditional theories however have been time and again criticised for being too simple and ignoring an important aspect which is very much evident in the emerging stock markets that is the Behavioural factor. The study tested applicability of APT in the Indian context using monthly data for the period January 2000 to December 2018. Factor analysis and Fama-Macbeth regression technique has been used to find out applicability of APT in the Indian context. Results were found to be partially suited towards the applicability of the APT in estimating the risk return parity of the 500 stocks listed on the Bombay Stock Exchange.

ANALYZING ECONOMIC VALUE ADDED (EVA) AND MARKET VALUE ADDED (MVA) PERFORMANCE MEASURES OF THE SELECTED INFORMATION TECHNOLOGY COMPANIES IN INDIA

Geetu Grover, Abhay Jain and Navkiranjit Kaur Dhaliwal

Volume 40, Issue 2 (Jul - Dec)

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The study attempts to analyze the shareholders’ value using Economic Value Added (EVA) and Market Value Added (MVA) performance measures on the selected Information Technology (IT) companies in India. It provides the ranking and classification of the selected IT companies in India based on MVA and EVA measures. A sample of 119 Information Technology companies in India has been selected using the Capitaline Database for the year 2007-08 to 2016-17. The study found that in totality, all the selected Information Technology companies were value creators (EVA+) except a few companies which were neither value creator nor value destroyer (EVA=0). Accordingly, almost 45% (i.e., EVA+ and MVA+) of the companies are value creators as well as wealth creators, while 55% of the IT companies (EVA+ and MVA-) are performing well. Still, the market is not optimistic about these companies. The IT giants like Wipro Ltd., HCL Technologies Ltd., Tech Mahindra Ltd., Tata Consultancy Services Ltd., and 3i Infotech Ltd., BPO have emerged as the best-performing companies in India. The in-depth analysis based on EVA and MVA of the selected companies will provide insights into the Information and Technology sector to help the investors in their decision to invest in this sector.

PRICING AND DISCOUNT PRACTICES OF SCIENTIFIC INSTRUMENTS INDUSTRY IN AMBALA CANTT

Karnika Gupta and Ishu Garg

Volume 40, Issue 2 (Jul - Dec)

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The present study is a humble attempt to examine the pricing and discount related practices of manufactures from the scientific instruments industry in Ambala Cantt in the state of Haryana. It divides the manufacturing units into micro, small and medium (MSME) enterprises, and compares the level of their practices. For accomplishing the purpose, a sample of 150 units is selected. Collected data are analyzed by using descriptive statistics (mean, standard deviation), and inferential statistics of ANOVA and Post Hoc Test. Results indicate that ‘skimming’ and ‘cost-plus’ pricing methods are highly employed in the industry; whereas, ‘penetration pricing’ is least preferred. Likewise, ‘quantity discount’ and ‘cash discount’ are in high preference, and ‘seasonal discount’ practice is rarely used. These are the medium units who apply all the pricing and discount practices firmly. Small units are also on their track. But, micro units lack behind in the level of usage of different practices. Hence, it is implied by the findings that micro units simply follow their counterparts. Correspondingly, this paper calls for further research to understand the complications involved in the decisions, and finding the solutions of enterprises’ problems.