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Initial Public Offering (IPO) is a kind of public offering in the form of companies' share which are sold to investors. An IPO is underwritten by one or more investment banks. These banks help in listing the shares on stock exchanges. The purpose of this research paper is to get a comprehensive analysis of previous research studies on the performance of IPO, which may provide the present growth and scope of research work in the field. 106 research studies on IPOs have been reviewed and outlined all the studies based on of their tools, methodology, year of the study, sample period, sample countries taken, type of studies, and sources of the study. For the present study, research articles published from 1998 to 2018 were selected for review. The outcomes of the analysis show that the number of studies on IPO rose continuously over the last seven years. The conclusion drawn from this paper may provide helpful facts regarding the following reviews of the IPO to investors, researchers, shareholders, and policymakers for taking important decisions. This study can be further refined by including the other classifications such as Google trend. [ABSTRACT FROM AUTHOR]

Purpose: Timely access to reasonably priced financing is critical to promote and sustain small and medium sized businesses (SMEs). This study aims to examine the role of the newly constituted SME exchanges in funding the growth of Indian SME firms. The impact of obtaining public equity capital on the firm's growth prospects, capital structure and credit profile is the focus of this paper. In addition, this study compares the cost and speed of raising capital on specialised SME exchanges to the main board. Design/methodology/approach: To examine the impact of raising public equity capital, this study uses a difference-in-difference (DID) regression analysis. SMEs that raised financing on the SME exchange between 2013 and 2018 make up the treatment sample. This study uses a propensity score matching technique to find the control group from a sample of unlisted enterprises to reduce the likelihood of selection bias. Findings: This study finds that SME profitability drops after an initial public offering (IPO), which is consistent with previous research. This study also discovered that after a company is listed, its total debt falls. This study also shows that after the IPO, there is no change in the borrowing costs of SME enterprises. Finally, this study finds an evidence of a decline in sales growth following the IPO, implying that the firms use the IPO money to rebalance their accounts after a period of heavy investment rather than for growth finance. Originality/value: A thriving and efficient equity financing market for SMEs has the potential to establish itself as a viable alternative to the existing dominant bank financing option. To the best of the authors' knowledge, this research is the first to examine the role of SME exchanges in the funding of Indian SME firms. [ABSTRACT FROM AUTHOR]

Purpose: This paper aims to explore the immediate proactive corporate social responsibility (CSR) efforts undertaken by select organizations in India in response to the coronavirus (COVID-19) pandemic and the approach they have adopted toward it. Design/methodology/approach: Semi-structured interviews were conducted with 27 senior managers across top Bombay Stock Exchange indexed organizations from the manufacturing and services sector in India during the national COVID-19 pandemic lockdown between March and June 2020. Manual content analysis and the Gioia method were used to arrive at the insights. Findings: Results of the analysis showcase the spirited immediate CSR measures undertaken by the select organizations in the broader interests of the community at large. The study also highlights the need for a paradox approach toward CSR strategy. Research limitations/implications: Given that the present study adopts an exploratory qualitative research design, the scope for generalization is rather limited. Practical implications: This paper classifies COVID-19 related initiatives undertaken by selected few top organizations in India and attempts to justify the need to opt for a paradox approach toward CSR strategy. Originality/value: To the best of the author's knowledge, this is one of the first few studies to have attempted to put forth a dialog at the intersection of COVID-19 and CSR with rich insights gained from qualitative data collected during India's intense lockdown period and offering a different perspective with the inclusion of paradox theory into the discussion. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to contribute to the existing literature on financial risk disclosure by examining a sample of non-financial Indian companies listed on the Bombay stock exchange (BSE) to explore the degree of information about financial risks contained in their annual reports. Design/methodology/approach: To study the financial risk disclosure of Indian companies, a sample of 206 non-financial companies has been derived from the top 500 listed companies at BSE. The method used in this study to analyze risk disclosure is content analysis. A total of 1,854 annual reports are scanned through software Nvivo-12 to find different types of risk words. Overall, risk disclosure, category wise risk disclosure, year-wise risk disclosure and sector-wise risk disclosure are assessed. The risk disclosure index is also computed. Findings: The results show that there are some risk disclosure practices in Indian companies. No general pattern is observed. Companies are following vague method of risk disclosure. In the true sense, Indian companies are now started risk disclosure practices since 2018. This may be because of pressure from regulating bodies and stakeholders with greater detail about their financial risks. Originality/value: This study is carried out for Indian non-financial companies. The paper adds to the literature relating to financial risk disclosure in developing countries. [ABSTRACT FROM AUTHOR]

Social Stock Exchange provides access to dedicated investors and businesses seeking to achieve a positive social and environmental impact through their activities. The aim of a social stock exchange is to act as a platform to bring social organizations and investors together whose missions and interests align with each other. Social stock exchanges are already established and functioning in a handful of countries including United Kingdom, Canada, South Africa, and Singapore. As far as India is concerned, SEBI has taken quick action to respond to the implementation of social stock exchange proposed in the Union Budget 2019, by forming a working group to examine and make recommendations for the same. The main objectives of this research paper were to analyse the working of SSEs in different countries using a descriptive study method. On understanding the working of SSEs around the globe, we have suggested certain features that can be implemented in the Indian Social Stock Exchange. We have also brought out the differences in the terms closely related to Social StockExchange like-Impact Investing (II), Socially Responsible Investing (SRI), Environmental, Social and Governance (ESG), and Thematic Investing (T.I.). [ABSTRACT FROM AUTHOR]

Purpose: This study aimed to investigate the effect of sustainability committee (SC) characteristics (size, independence, the number of meetings, and expertise) on corporate social responsibility (CSR) performance in the Indian context. Design/methodology/approach: This research measures the CSR performance of 60 Indian non-financial firms listed on the Bombay Stock Exchange (BSE) over the period 2014 to 2019 using the ASSET4 environmental, social, and governance database. The authors resorted to fixed-effect panel regressions to capture the individual effect present in the data. Findings: The results show that CSR performance is positively and significantly influenced by SC independence, size, and expertise. However, the number of SC meetings does not affect CSR performance. The results also demonstrate that CSR performance is positively and significantly associated with board independence. Research limitations/implications: This paper adds to the existing literature by examining the effect of SC characteristics on the firms' CSR performance in India as one of the oldest stock markets in the world, which would help test the validity of the agency and stakeholder theories in an old and big emerging market context. Practical implications: The findings allow managers to understand the mechanisms affecting CSR performance and how the characteristics of the SC can participate in its growth and development. Moreover, this study has implications for researchers, suggesting that future CSR studies should take into account the SC characteristics as potential determinants that explain CSR, such as CSR activities and CSR practices and strategies. Originality/value: The present research contributes to the literature by investigating the effect of SC characteristics on the firms' CSR performance, thereby providing additional evidence on the issue. Several previous studies have examined the link between corporate governance and CSR performance with a focus on external oversight mechanisms, namely institutional ownership or analyst coverage or internal oversight mechanisms, such as board gender composition, board independence, separation of board Chairperson and CEO roles, and the existence of SC on the board, but these studies did not examine the SC characteristics. The present research fills the gap. [ABSTRACT FROM AUTHOR]

Purpose: The preference of firm corporate social responsibility (CSR) spending is shaped by different groups of owners and the institutional environment in which the firm operates. This paper aims to study the heterogeneity among the controlling groups and firms' internationalization in influencing the CSR decision in emerging economy firms. Design Methodology Approach: This paper draws understanding from institutional theory to inspect the propensities of various ownership groups such as lending institutions (LI), domestic mutual funds (MF) and foreign institutional investors (FIIs). The empirical analysis was conducted from a sample of 1,594 unique Bombay stock exchange (BSE)-listed non-financial Indian firms during the 2014–2019 period using Tobit panel regression analysis. Findings: The findings reveal that firms' CSR activities are impacted differently by ownership share of different types of institutional investors after controlling for firm-level resources and capabilities. Lending institutions, FIIs and MF are supportive of CSR investments by firms along with international investments by the firm. Further, the results show that the CSR spend is positively influenced by the business group affiliation of the firm compared to the unaffiliated group of firms. Practical Implications: The analysis has implications for both institutional investors and multinational firms. In the merging market context, managers and owners who target long term strategies such as CSR will benefit from increasing shareholdings of creditors (lending institutions). They can also take steps to improve their transparency and corporate governance structure so as to attract foreign institutional investments, thus, in turn, helping the internationalization process of the firm. Originality Value: This paper considers the role of the diverseness of the ownership institutional investors along with the moderating effect of business group affiliation of the firm and international investments in impacting the CSR spend. This disparity has not been previously studied with the latest data in an emerging economy context. [ABSTRACT FROM AUTHOR]

The paper aims to empirically investigate the influence of corporate social responsibility (CSR) on firm performance in Indian listed firms. We use regression analysis to determine the relationship between CSR and firm performance. Both accounting and market measures of firm performance have been deployed for the purpose of the study. We have found mixed evidence. While CSR has a positive impact on the accounting measure, it has a weak relationship with market-based returns. Our most significant finding in the study is that markets do not perceive the standard mandated CSR spends worthy of a reward. Instead, such spends are considered hygiene whereas expenditure made by firms in excess of the mandated CSR spends is rewarded by markets for their CSR conscious behaviour. We therefore advise the Indian companies to spend beyond the mandated CSR outlays if they are to improve on their market value. [ABSTRACT FROM AUTHOR]

This study explores the relationship of investment done by domestic institutional investors (DII) and stock market returns. The paper covers a bigger definition of DII's, bifurcating them into four categories, (a) mutual fund, (b) venture capital fund, (c) financial institutions and (d) insurance companies who have invested in national stock exchange of India. The study uses CNX Nifty 50 to represent the stock market of India. ARDL bound testing cointegration model is applied to find the relationship between the Dependent variable (nifty 50) and Independent variables (mutual fund, venture capital fund, Indian financial institution and insurance companies) This analysis will help regulatory authorities to improvise on policy making on investment in stock market for insurance companies, financial institution, venture capital fund and mutual fund. The surge in domestic institutional equity inflows, will help to insulate the Indian equity market from the high velocity traders of overseas. This is the first study to undertake domestic institutional investors at a disintegrated level. [ABSTRACT FROM AUTHOR]

This paper highlights the organic link that exists between the corporate social responsibility (CSR) activities undertaken by the Indian corporate sector and their alignment with the Sustainable Development Goals (SDGs) from 2014–2016; the period after mandatory CSR came into existence as per Indian Companies Act. In this study, we identify critical areas pertaining to SDG goals neglected by corporate sector as far as CSR investments are concerned. We find that more  CSR investments must be drawn towards climate change, biodiversity, Sustainable consumption and production, marine life and conserving flora and fauna. The sectoral analysis reveals that the companies falling under sectors that have a higher environmental footprint and impact are more concerned about taking up initiatives through CSR. The geographic analysis revealed that efforts need to be made to increase CSR expenditure in seven north‐eastern states, Jammu and Kashmir, and Union Territories. This paper recommends that the system needs to be further reviewed in light of the current observations. [ABSTRACT FROM AUTHOR]

Purpose: The phenomenon known as financialization of commodities, arising from the speculation in commodity derivatives market, has raised serious concerns in the recent past. This has prompted distortion in agricultural commodity prices driving them away from rational levels of supply and demand shocks. In the backdrop of financialized commodities leading to increase in price of agricultural products and their interaction with equity markets, the authors examine the investment of institutional investors in impacting the agricultural returns. The paper aims to focus on the financial mechanism that drives extreme values and the mean of agricultural returns. Design/methodology/approach: The authors employ the Threshold AutoRegressive Quantile (TQAR) methodology to find evidence of linkages between the Indian agricultural and equity markets from January 2010 to May 2020 consistent with the rise in inflows of institutional investors in agricultural markets. Findings: The results reveal that the investors impact the agricultural commodity markets strongly when the composite commodity index value (COMDEX) is low. Additionally, in the lower extreme quantiles (0.25) of agricultural returns, the integration between the equity index and agricultural returns is found to be highly significant compared to insignificant values in the higher quantiles (0.75 and 0.95) in both the regimes. The results suggest that low values of agricultural commodities are more closely linked to equity indices when composite commodity index value is low. This implies that, at the lower quantiles of COMDEX return (bad day), the investors move to the stock market. In that way, the commodity index returns are seen to be as a strong channel for the financialization of Indian agricultural commodities and suggesting potential involvement of investors during those regime. Research limitations/implications: Regulators need to anticipate the price fluctuations in spot and futures markets. Investors in commodity markets need to strengthen risk awareness to carry out portfolio strategies. Practical implications: From policy perspective, it is of pivotal importance to enhance the understanding of the financialization of agricultural products. The findings provide reference measures to stabilize the commodity markets, alleviate price distortions and carry out further evidence of price discovery and risk management in Indian commodity markets. Originality/value: To the best of the authors' knowledge, this study is the first to highlight the potential influence of financial markets on the financialization of agricultural commodities in an emerging economy like India. [ABSTRACT FROM AUTHOR]

This paper provides an empirical examination of the determinants of borrowings in hotel companies listed on Bombay Stock Exchange. A sample of 50 hotel companies listed on BSE was studied and it is revealed that the 'company size', 'return on capital employed' and 'non-debt tax shield' are the most important determinants of total debt ratio in hotel industry in India. While the 'collateral value of assets', 'company size' and 'return on capital employed' are the most important determinants of long term debt ratio in hotel industry in India. The paper has been divided into five sections i.e. backdrop, review of literature, research methodology, results and discussions followed by conclusions. [ABSTRACT FROM AUTHOR]

Purpose - The purpose of this paper is to examine the lead-lag relationships between the National Stock Exchange (NSE) Nifty stock market index (in India) and its related futures and options contracts, and also the interrelation between the derivatives markets. Design/methodology/approach - The paper uses serial correlation of return series and autoregressive moving average (ARMA) model for studying the lead-lag relationship between hourly returns on the NSE Nifty index and its derivatives contracts like futures, call and put options. Further, the lead-lag relation between hourly returns of the derivatives contracts among themselves is also studied using ARMA models. Findings - The ARMA analysis shows that the NSE Nifty derivatives markets tend to lead the underlying stock index. The futures market clearly leads the cash market although this lead appears to be eroding slightly over time. Although the options market leads the cash overall, there is some feedback between the two with the underlying index leading at times. Further, it is found that the index call options lead the index futures more strongly than futures lead calls, while the futures lead puts more strongly than the reverse. Practical implications - The results imply that the derivative contracts on NSE Nifty lead the underlying cash market. Thus, the derivative markets are indicative of futures price movements and this will certainly be helpful to potential investors to design their risk-return portfolio while investing in stocks and derivatives contracts. - Originality/value - This paper is an original piece of work towards exploring the lead-lag relation between NSE Nifty and the derivative contracts. The issue of price discovery on futures and spot markets and the lead-lag relationship are topics of interest to traders, financial economists, and analysts. [ABSTRACT FROM AUTHOR]

Purpose: The authors examine the industrywise investment preferences of foreign portfolio investors (FPIs), domestic institutional investors (DIIs) and retail investors in the Indian context. They also investigate the factors influencing their preferences. Design/methodology/approach: Using the quarterly shareholdings and returns data of the Indian market from March 31, 2009 to March 31, 2018, the authors employ analysis of variance to study investors' preferences and a random effect panel data model to examine the factors that influence these preferences. Findings: FPIs hold proportionally more stocks in service-oriented industries and large-cap firms, DIIs hold proportionally large numbers of shares in paper industries and retail investors hold proportionally more shares in chemicals and textiles. FPIs prefer stocks with a high export-to-sales ratio and firms registered on a foreign stock market. Domestic investors, especially retail investors, prefer small-cap stocks and firms whose operations require local knowledge. In addition, industry heterogeneity determines investment decisions. Firm-specific and macroeconomic factors that influence investment decisions differ across industries. Finally, government policies and reforms also play a key role in attracting investors. Practical implications: Policymakers can identify the key variables that influence investment, which can help direct and regulate investment in India and similar emerging markets. Originality/value: This study fills a research gap by addressing how industry-level heterogeneity affects investors' preferences in terms of the industrywise preferences of different types of investors and the factors that influence their preferences. [ABSTRACT FROM AUTHOR]

Purpose The purpose of this paper is to explore whether stock selection strategies based on four fundamental quality indicators can generate superior returns compared to overall market.Design/methodology/approach The sample of stocks comprises the constituents of BSE-500 index, which is a broad based index consisting of highly liquid stocks from all 20 major industries of the Indian economy. Portfolios are constructed on the basis of quality indicator rankings of companies and the returns of these portfolios are compared with the overall market. Excess returns on quality based portfolios are also determined using OLS regressions of quality portfolio returns on market, size, value and momentum factor returns.Findings The results suggest that two of the four quality strategies, namely Grantham Quality indicator and Gross Profitability have generated superior returns after controlling for market returns as well as common anomalies such as size, value and momentum. Combining value strategies with quality strategies do not yield any significant gains relative to quality only strategies.Practical implications For investors looking to invest in the Indian stock market for a long term, this study provides evidence on the performance of some fundamental indicators that can help predict long run stock performance. The findings suggest that investors can distinguish between high-performing and low-performing stocks based on stock quality indicators.Originality/value This is the first such study to look into the performance of quality investing in the Indian stock market. As most quality investing studies have been focussed on developed economies, this paper provides out-of-sample evidence for quality investing in the context of an emerging market. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to investigate the linkages between Indian stock markets with other Asian stock markets namely, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Taiwan and China. Such a study is particularly important because if the level of integration among the markets is high, then investing in different markets will not generate long term gains from portfolio diversification or reduction in risk. Design/methodology/approach – The paper applies unit root test in the presence of endogenous structural breaks that uses a Lagrange Multiplier (LM) test statistics and the Gregory and Hansen cointegration technique that allows for endogenous determined structural break in the relationship have been applied. Findings – The results suggest that the Indian stock markets are not integrated with any of the Asian markets either individually or collectively, and conclude that Indian markets are not sensitive to the dynamics in these markets in the long run. Originality/value – Since the level of integration has been studied keeping in mind the different economical phases like recession and boom, the study has incorporated the possibility of existence of structural breaks in the individual stock return series as well as in their relationship. The lack of evidence on interlinkage of Indian stock markets with other Asian markets suggests that the trend of Indian markets is not in sync with other markets, possibly due to difference in macroeconomic structure. Since the level of integration has been studied keeping in mind the different economical phases like recession and boom, the study has incorporated the possibility of existence of structural breaks in the individual stock return series as well as in their relationship. The lack of evidence on interlinkage of Indian stock markets with other Asian markets suggest that the trend of Indian markets is not in sync with other markets, possibly due to difference in macroeconomic structure. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to examine the dynamics between income diversification and performance (cost, profit, revenue, technical, pure technical and scale efficiency) for 38 listed Indian banks within panel data framework during the period 2004-2005 to 2015-16. Design/methodology/approach: This study computes bank's cost, profit, revenue, technical, pure technical and scale efficiency within intermediation approach with data envelopment analysis (DEA) as a performance indicator, followed by exploring the association between income diversification and bank performance using truncated Tobit regression within panel data framework. Findings: Tobit regression results revealed inverted U-shaped relationship between the income diversification and estimated efficiency parameters for the overall panel. Size and bank intermediation ratio seems to be a major factor in exploiting the potential benefits of income diversification. The author reconfirmed the inverted U-shaped relationship with these efficiency parameters for exclusive subsamples consisting of government-owned and private sector banks. Research limitations/implications: Inverted U-shaped relationship between the income diversification and estimated efficiency parameters suggest that banks should go for limited diversification to improve performance. Thus, regulators and banks should pursue limited diversification strategy for improving banking efficiency. Originality/value: This study computes bank performance (cost, profit, revenue, technical, pure technical and scale efficiency) based on DEA followed by exploring the association between performance and income diversification for 38 Bombay stock exchange listed banks. [ABSTRACT FROM AUTHOR]

Purpose - The purpose of this paper is to examine the long-run relationship between the Indian capital markets and key macroeconomic variables such as interest rates, inflation rate, exchange rates and gross domestic savings (GDS) of Indian economy. Design/methodology/approach - Quarterly time series data spanning the period from January 1995 to December 2008 has been used. The unit root test, the co-integration test and error correction mechanism (ECM) have been applied to derive the long run and short-term statistical dynamics. Findings - The findings of the study establish that there is co-integration between macroeconomic variables and Indian stock indices which is indicative of a long-run relationship. The ECM shows that the rate of inflation has a significant impact on both the BSE Sensex and the S&P CNX Nifty. Interest rates on the other hand, have a significant impact on S&P CNX Nifty only. However, in case of foreign exchange rate, significant impact is seen only on BSE Sensex. The changing GDS is observed as insignificantly associated with both the BSE Sensex and the S&P CNX Nifty. The paper, on the whole, conclusively establishes that the capital markets indices are dependent on macroeconomic variables even though the same may not be statistically significant in all the cases. Originality/value - This study emphasises on the impact of macroeconomic variables on the stock market performance of a developing economy, whose performance is measured by these variables. [ABSTRACT FROM AUTHOR]

The permission to Foreign Institutional Investors (FIIs) in 1992, to invest in Indian stock market was the first major step of government towards the implication of the globalization policies regarding Indian financial system. Since then, FIIs have been contributing significantly and emerged as one of the main sources of equity capital flows to Indian stock markets. Present paper provides a glimpse of the latest investment trends of FIIs during year 2008-09 and 2009-10 (so far). The paper also provides an overview of FIIs related regulatory environment and recent policy changes to attract outgoing FIIs capital from Indian stock markets after global financial crisis. [ABSTRACT FROM AUTHOR]

In prior literature it was conjectured that the Indian stock market responses on domestic macroeconomic surprises are expected to be significantly influenced by global surprises. In this paper we empirically established that hypothesis. We used both the Event Analysis and VAR model. We found that global surprises consistently dominate Indian stock market and the influence of domestic macroeconomic surprises on it is relatively less. The understanding of stock market dynamics against domestic macroeconomic surprises and global factors can provide assistance to the policy makers for augmenting policy effectiveness and the corporate finance professionals for enhancing decision making. [ABSTRACT FROM AUTHOR]

Purpose - The purpose of this paper is to survey managers of dividend-paying firms listed on the National Stock Exchange (NSE) in India to learn their views about the factors influencing dividend policy, dividend issues, and explanations for paying cash dividends and repurchasing shares. The authors compare the results to other dividend surveys based on firms in Indonesia, Canada, and the USA. Design/methodology/approach - The authors use questionnaire to gather primary data from a sample of 500 firms listed on the NSE. Findings - The most important determinants of dividends involve earnings (the stability of earnings as well as the level of current and expected future earnings) and the pattern of past dividends. Comparing the overall rankings of the 21 factors by respondents from Indian firms to those of Indonesian, Canadian, and US firms reveals statistically significant correlations. Respondents also perceive that dividend policy affects firm value. Respondents also view maintaining an uninterrupted record of dividends as important. The most highly supported explanations for paying cash dividends concern signaling, the firm life cycle, and catering. Although none of the theories of repurchasing shares is dominant, respondents provide little support for the agency explanation. Research limitations/implications - Although the tests suggest that the sample does not suffer from non-response bias, the findings should be viewed as suggestive rather than definitive because of the relatively low response rate. Originality/value - The paper presents new evidence about dividend policy of Indian firms. To the knowledge, this is the most comprehensive survey of Indian firms to date that captures managerial perceptions on both cash dividends and share repurchases. [ABSTRACT FROM AUTHOR]

A significant boom occurred in the Indian financial market and growth in the post-liberalization era. This motivates us to analyze the impact of stock market and credit market (two components of financial market) for the growth of financial market. This paper attempts to show the linkage between stock and credit markets and their impact on the Indian economy taking the period after post-liberalization. The period of analysis is from 1994 to 2010; we identify the three variables as stationary and find a relationship between the financial market and gross domestic product (GDP) and a long-run effect of lagged differences in credit market on GDP. It has been inferred that stock market development has larger and more significant long-run mutual effects on economic growth than credit market development in India. [ABSTRACT FROM AUTHOR]

While there has been a rapid growth of business and management schools in India since 1990, the curricula, teaching methods and the mode of delivery largely remain an instructor-led approach overlooking the needs of learners and potential employers. This paper presents a learner-centric investment management course known as Student-Managed Investment Course (hereafter, SMIC). It elucidates the structure, design and implementation of SMIC based on the principles of experiential learning. SMIC has been organised to create a conducive environment for the emergence of varied experiences and encourage reflections among students on the theory and practice of investment finance. The unique feature of the course is real-time exposure to investment activity in the Bombay Stock exchange/National Stock exchange, which helps students observe and grasp the nuances of capital market functioning and to acquire requisite skills for financial decision-making. This document on SMIC has a value in being a useful guide for other business schools in India for adopting a learner-centric approach to investment management. [ABSTRACT FROM AUTHOR]

The study examines the approach followed by financial analysts for the appraisal of equity shares in India. The Primary focus of the paper is on the usefulness of fundamental analysis and technical analysis. A comprehensive questionnaire instrument was designed based on the unstructured interviews of five financial advisors in the first round. A survey was then conducted on a group of 56 financial analysts. It is observed that Fundamental analysis is a more preferred approach to equity appraisal compared to technical analysis. The analysts also believe that Indian markets are weak-form efficient, which can be one possible reason for the preference for fundamental analysis. The financial analysts in India mostly use the ratio analysis and P/E ratio as a tool for stock valuation and consider technical analysis as a risky tool to be mostly used by the day traders and short-term investors. Investors in any stock market do not operate in isolation and mostly rely on the information and reports provided by the financial analysts. In this context, the study is of great importance as the study provides the perspective of financial analysts. However, the relatively small sample size is a limitation of the study. [ABSTRACT FROM AUTHOR]

Purpose: The study seeks to capture the small-cap value-premia and to examine the risk-return trade-off in the small cap space in the Indian stock market. Research Design/Methodology: Based on the monthly-adjusted closing prices of 26 small-cap stocks, constituting the NSE Nifty Small Cap 50, alpha stock return and underlying volatilities were captured in this study using the simple linear regression analysis. Returns variability and volatilities were further used to examine the underlying ex-post risk-reward trade-off in terms of the Sharpe, Treynor and Jensen measures during the period of April 2005 - March 2018. Findings: The present study was unable to document pervasiveness of much-talked-about small-size value premia in the Indian market. The study has revealed that the risk-reward trade-off drift in the small cap market indices as the small-cap value was noticed in the bottom of the small-cap universe. This drift was explained by 'big money chasing smaller universe of quality small-cap stocks' phenomenon. Originality/value: This study adds value to the personal finance and investment literature by proposing that the investors should focus on the good quality micro cap stock selection over allocating the resources to the chased portfolios of small-cap stocks in their quest for wealth maximisation. Policy Implications: The findings of the study show that the risk-bearing is rewarded more by micro-stock selection, instead of the market forecasting in the emerging markets. This is what makes this study curious! Limitations: Study outcomes reported in this paper are based on a smaller universe (sample) for the April 2005 - March 2018 period. This universe missed the new investible opportunities from digital space as such stocks still are not listed on the bourses thus far in India. [ABSTRACT FROM AUTHOR]

Purpose - The purpose of this paper is to estimate time-varying conditional volatility, and examine the extent to which trading volume, as a proxy for information arrival, explain the persistence of futures market volatility using National Stock Exchange S&P CRISIL NSE Index Nifty index futures. Design/methodology/approach - To estimate the volatility and capture the stylized facts of fat-tail distribution, volatility clustering, leverage effect, and mean-reversion in futures returns, appropriate ARMA-generalized autoregressive conditional heteroscedastic (GARCH) and ARMA-EGARCH models with generalized error distribution have been used. The ARMA-EGARCH model is augmented by including contemporaneous and lagged trading volume to determine their contribution to time-varying conditional volatility. Findings - The paper finds evidence of leverage effect, which indicates that negative shocks increase the futures market volatility more than positive shocks of the same magnitude. In addition, the results indicate that inclusion of both contemporaneous and lagged trading volume in the GARCH model reduces the persistence in volatility, but contemporaneous volume provides a greater reduction than lagged volume. Nevertheless, the GARCH effect does not completely vanish. Practical implications - Research findings have important implications for the traders, regulatory bodies, and practitioners. A positive volume-price volatility relationship implies that a new futures contract will be successful only to the extent that there is enough price uncertainty associated with the underlying asset. Higher trading volume causes higher volatility; so, it suggests the need for greater regulatory restrictions. Originality/value - Equity derivatives are relatively new phenomena in Indian capital market. This paper extends and updates the existing empirical research on the relationship between futures price volatility and volume in the emerging Indian capital market using improved methodology and recent data set. [ABSTRACT FROM AUTHOR]

Purpose — The paper aims to study the impact of the introduction of Nifty index futures on the volatility of the Indian spot markets by use of econometric models. Design/methodology/approach — The study considered six measures of volatility, the dynamic linear regression model, and the GARCH models to investigate volatility in National Stock Exchange (NSE) Nifty prices both before and after the onset of futures trading. Findings — The GARCH analysis confirmed no structural change after the introduction of futures trading on Nifty, and found that whilst the pre-futures sample was integrated, the post-futures sample was stationary. Spot returns volatility is found to be less important in explaining spot returns after the advent of futures trading in NSE Nifty. Practical implications — The results imply that futures markets serve their prescribed role of improving pricing efficiency and improve the quality of information flowing to spot markets. This will enable investors to prudently structure their strategies investing in both spot and futures markets. Originality/value — This study is an original piece of work towards exploring the impact of the introduction of futures trading on cash market volatility in an emerging economy like India. [ABSTRACT FROM AUTHOR]

Stock splits are a relatively new phenomenon in the Indian context. This paper examines the market effect of stock splits on stock price, return, volatility, and trading volume around the split ex-dates for a sample of stock splits undertaken in the Indian stock market over the period 1999–2005. The traditional view of stock splits as cosmetic transactions that simply divide the same pie into more slices is inconsistent with the significant wealth effect associated with the announcement of a stock split. However, the empirical evidence confirms a negative effect on price and return of stock splits. The overall cumulative abnormal returns after the split are negative. These results suggest that stock splits have induced the market to revise its optimistic valuation about future firm performance, rejecting signaling hypothesis to which splits convey positive information to markets. Hence, stock splits have reduced the wealth of the shareholders. The results also show that presence of a positive effect on volatility and trading volume following the split events, thus suggesting that split events enhance liquidity. [ABSTRACT FROM AUTHOR]

In this paper, an aggregate financial stress index for India is constructed by taking monthly data from different segments of the financial market like money market, bond market, equity market, foreign exchange market, and the banking sector, for the period March 2007 to December 2016. The interrelationship and feedback effect between financial stress, economic growth and price stability are tested by using correlation and an unrestricted VAR model. The impulse response analysis shows that financial stress leads to a decline in growth after a lag period and a higher growth rate for a longer period of time increases stress in the financial system. The variance decomposition result indicates that the contribution of FSI to the variation of other variables are not much high, whereas other variables can affect FSI to some extent. In the Short-run price stability increases financial stress but in the long run, the result is the opposite. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to investigate Indian companies’ compliance with the mandatory and voluntary corporate governance disclosure requirements of the Stock Exchange Board of India’s Clause 49. Design/methodology/approach – The authors develop a corporate governance disclosure index and sub-indices based on Clause 49. Annual reports of listed Indian companies are scored according to their disclosures in two periods – pre and post amendments to Clause 49. Findings – Indian companies are highly compliant with corporate governance disclosure requirements of Clause 49. Disclosure increases significantly after amendments to Clause 49 as the penalties for non-compliance increase in severity. Government controlled firms disclose significantly less than privately owned firms. Research limitations/implications – The findings are consistent with bonding theory and the authors note that the presence of an independent regulator (with powers to take action against violators) provides corporate India with additional incentives to comply with corporate governance reform. Practical implications – These findings have important implications for policy makers and regulators as they contribute to the debate on the choice between formal corporate governance regulation versus informal self-regulation. The study also has implications for understanding factors associated with the adoption of disclosure practices in general. Originality/value – This is the first study to examine disclosure compliance in a major developing country pre and post amendments to mandatory corporate governance requirements. Prior evidence indicates a low level of disclosure in India but our results demonstrate an improvement in line with our theoretical predictions that suggests, India is converging towards an Anglo-Saxon model of corporate governance. [ABSTRACT FROM AUTHOR]

This paper investigates the relationship between stock market returns and volatility in the Indian stock markets using AR(1)-EGARCH(p, q)-in-Mean model. The study considers daily closing prices of two major indexes of Indian stock exchanges, viz., S&P CNX NIFTY and the BSE-SENSEX of National Stock Exchange (NSE) and Bombay Stock Exchange (BSE), respectively for the period from July 1, 1997 to December 31, 2013. The empirical results show positive but insignificant relationship between stock returns and conditional variance in the case of NSE Nifty and BSE SENSEX stock markets. Besides, the analysis reveals that volatility is persistent and there exists leverage effect supporting the work of Nelson (1991) in the Indian stock markets. The present study suggests that the capital market regulators, investors and market participants should employ the asymmetric GARCH-type model that sufficiently captures the stylized characteristics of the return, such as time varying volatility, high persistence and asymmetric volatility responses, in determining the hedging strategy and portfolio management and estimating and forecasting volatility for risk management decision making at Indian Stock Exchange. [ABSTRACT FROM AUTHOR]

In this paper, we study the performance of the Artificial Neural Networks (ANNs) and GARCH models to predict the volatility of the Indian stock market indices namely, NIFTY 50, NIFTY Bank and NIFTY FMCG. We have used the GARCH (1,1) and Recurrent Neural Network, a type of neural network which is widely used for predicting time series data. The purpose of the study is to investigate if the Artificial Neural Networks perform better than the traditional GARCH (1,1) model. An out of sample testing methodology is applied to the most recent 20 percent of the observations for all the three indices. We have used Root Means Squared Error (RMSE) and Mean Absolute Error (MAE) as metrics to evaluate the volatility predicting performances of the models. The results show no clear evidence of ANN model performing better than GARCH model for any of the three indices. ANNs may prove to be better indicators in periods with low volatility while its performance deteriorated in periods with high volatility. [ABSTRACT FROM AUTHOR]

The economic crises of 1991 forced India to reassess its protectionist, closed economy system. Globalisation was the imminent choice. The opening up and integration of the Indian economy with the rest of the world brought a dramatic change in its business environment and governance standards. The Indian stock markets matured and we have witnessed a tremendous interest among international investors in entering this emerging market. This paper traces the history of corporate governance in India and discusses key unresolved issues against the backdrop of sweeping reforms in the stock market structure, systems and regulation.International Journal of Disclosure and Governance (2008) 5, 205–235. doi:10.1057/jdg.2008.9 [ABSTRACT FROM AUTHOR]

Purpose — An understanding on the linkages between financial development and economic growth in general and the stock market with economic activity in particular is imperative in emerging economies. The objective of this paper is to find out the causal linkages between stock market and economic activity in India. Design/methodology/approach — The paper applies recently developed Granger non-causality tests by Toda-Yamamota, Dolado and Lutkephol (popularly known as the TYDL model) for an empirical exercise. Findings — The notable finding of the paper is that both the stock price (BSE Sensex) and economic activity (IIP) are integrated of order one, i.e. I(1). The Johansen-Juselius co-integration tests suggest the existence of one co-integrating vector. This rules out spurious relations and suggests the presence of at least one direction of causality. The TYDL model suggests that there is bi-directional causality between stock price and economic activity during the post-liberalization period, implying that a well-developed stock market could enhance economic activity and vice-versa. Research limitations/implications — In the broader framework of financial markets, the presence and role of the stock market is minuscule in the context of India. Despite this, it could play a considerable role in the process of the economic development of the country. However, to analyze the cause and effect relationship between stock market and economic activity, it is essential to analyze the issue in greater detail and depth. The main limitation of the paper is the use of IIP as a proxy for economic activity, which neglects the agricultural sector, being the primary sector in India and also the service sector. This is of course due to the non-availability of GDP data on a monthly basis. Further, a detailed study on the issue could be highly appreciable from the perspective of policy implications. Originality/value — The findings of the paper have some valuable implications. It could give some insight for policy makers about the possible linkages between stock market and the economy. Coming to empirical parts, this is perhaps the first paper in the context of India to apply the TYDL model to examine the relationship between stock price and economic activity. [ABSTRACT FROM AUTHOR]

This paper examines the profitability of the Indian stock market using an extensive new data set that includes 1,515 stocks and covers a time-period spanning 1992 to 2014. Using both the popular Jegadeesh-Titman and the 52-week momentum trading strategies, we discover that portfolios of all stocks and various portfolios of industry stocks are profitable. These profits, we find, disappear once we account for a range of market and macroeconomic factors, suggesting that market and industry profits are compensation for risks. Our results survive a battery of robustness tests. [ABSTRACT FROM AUTHOR]

In this paper, we study the impact of accounting fraud revelation on trading behaviour of investors. Using daily investor account holdings data from the National Stock Depository Limited (NSDL), the largest depository in India, we find that investors directly exposed to accounting fraud cash out almost 10.7 percentage points of their overall portfolio relative to investors not directly exposed. The cashing out is largely restricted to the bad stock. Over the period of a month, however, there is no difference in the trading behaviour of the treated and control investors. • This paper studies the effect of an accounting scandal on retail investment behaviour. • Those with direct exposure (treated) to fraud cash out more relative to those without direct exposure (control). • The cashing out is largely restricted to the \bad stock". • Over the period of a month, there is no di_erence in the trading behaviour of treated and control investors. • Results are contrary to those found in developed markets. [ABSTRACT FROM AUTHOR]

The COVID‐19 outbreak and the subsequent lockdown were an unanticipated shock to the global stock market. Managers also had minimal time to counterbalance its effect through corporate policies. Therefore, this health crisis offers a unique opportunity to examine the effect of corporate social responsibility (CSR) on shareholder value. We observe that firms engaged in more CSR activities outperform other firms. This suggests that CSR plays a positive role in determining shareholder value, particularly for an emerging market where minority shareholder rights are weak. Collaborating with our main finding, we further find that governance metrics play a significant role. [ABSTRACT FROM AUTHOR]

New Keynesian dynamic stochastic general equilibrium models with various specifications of technology, markup, and interest rate shocks are estimated with Indian data using Kalman filter based pure and Bayesian likelihood estimation. Preference and interest rate shocks are found to be important for output determination, whereas markup and interest rate shocks are important for inflation. News, as contained in stock market variables and arising from anticipated interest rates, affects growth of gross domestic product. Interest rate shock is anticipated at horizon of one quarter and out of total variance explained by interest rate shock, one third is due to the anticipated shock. Anticipated interest rate shock diminishes the share of preference shock in output determination. Although markup shock has a large share, its persistence is low. There is evidence that permanent component of technology is not well anticipated. Once we incorporate this, technology shocks affect output more, although they still remain much below US levels. Implications for policy include forward guidance on interest rates, less reaction to short‐term supply shocks, and allowing technology shocks to play out. [ABSTRACT FROM AUTHOR]

Purpose: The study presents the zero investment strategies based on the pricing impact of real earnings management (REM) on stock returns after taking into account the direction and endogeneity nature of REM. Design/methodology/approach: The authors use standard portfolio methodology and Fama–Macbeth cross-sectional regression to analyze the data for this study. Both upward and downward form of REM has been examined. Accrual earnings management (AEM) has been controlled while examining the association between REM and stock returns. Findings: The findings demonstrate that the REM anomaly exists in the Indian equity market and is consistent under different market conditions and investment horizons. It is robust after controlling for cross-sectional effects and AEM. Our subsequent analysis suggests that a decile-based zero investment portfolio strategy based on REM loadings generates an annual excess return of 17.90%. The presented annual excess return is highest among quantile and mean-based investment strategies. Further, the authors find that REM sorted proposed investment strategies outperform the AEM sorted investment strategies in all spheres. Practical implications: The findings suggest that investors can form an arbitrage profitable investment strategy by taking a long position in the bottom 10% of negative REM stocks, and a short position in the top 10% of positive REM stocks. Originality/value: This is the first study that examines the pricing impact of REM on stock returns and provides zero investment strategies by betting against REM. [ABSTRACT FROM AUTHOR]

Purpose: The portfolio of low-risk stocks outperforms the portfolio of high-risk stocks and market portfolios on a risk-adjusted basis. This phenomenon is called the low-risk effect. There are several economic and behavioral explanations for the existence and persistence of such an effect. However, it is still unclear whether specific sector orientation drives the low-risk effect. The study seeks to answer the following important questions in Indian equity markets: (a) Whether sector bets or stock bets mainly drive the low-risk effect? (b) Is it a mere proxy for the well-known value effect? (c) Does the low-risk effect prevail in long-only portfolios? Design/methodology/approach: The study is based on all the listed stocks on the National Stock Exchange (NSE) of India from December 1994 to September 2018. It classifies them into 11 Global Industry Classification Standard (GICS) sectors to construct stock-level and sector-level BAB (Betting Against Beta) and long-only low-risk portfolios. It follows the study of Asness et al. (2014) to construct various BAB portfolios. It applies Fama–French (FF) three-factor and Fama–French–Carhart (FFC) four-factor asset pricing models in addition to Capital Asset Pricing Model (CAPM) to examine the strength of BAB, sector-level BAB, stock-level BAB and long-only low-beta portfolios. Findings: Both sector- and stock-level bets contribute to the return of the low-risk investing strategy, but the stock-level effect is dominant. Only betting on safe sectors or industries will not earn economically significant alpha. The low-risk effect is unique and not a value effect in disguise. Both long-short and long-only portfolios within sectors and industry groups deliver positive excess returns. Consumer staples, financial, materials and healthcare sectors mainly contribute to the returns of the low-risk effect in India. This study offers empirical evidence against the Samuelson (1998) micro-efficient market given the strong performance of the stock-level low-risk effect. Practical implications: The superior performance of the low-risk investment strategies at both stock and sector levels offers investors an opportunity to strategically invest in stocks from the right sectors and earn high risk-adjusted returns with lower drawdowns over an entire market cycle. Besides, it paves the way for stock exchanges and index manufacturers to launch sector-specific low-volatility indices for relevant sectors. Passive funds can launch index funds and exchange-traded funds by tracking these indices. Active fund managers can espouse sector-specific low-risk investment strategies based on the results of this and similar other studies. Originality/value: The study is the first of its kind. It offers insights into the portfolio characteristics and performance of the long-short and the long-only variant of low-risk portfolios within sectors and industry groups. It decomposes the low-risk effect into sector-level and stock-level effects. [ABSTRACT FROM AUTHOR]

Behavioural finance is emerging field with wide scope. In the absence of enough of literature in Indian context, understanding of individual investor's behaviour towards stock market by the policy makers, institutions, market infrastructure institutions, and companies find it challenging. The behaviour is caused by the reaction to different factors/attributes. In order to understand the factors that influence the investor's investment decision a study was undertaken in Indian stock market consisting of 10 sectors with 30 companies listed on BSE-30 SENSEX. A research instrument consisting of 14 attributes was designed and sent to 2100 respondents. 467 responses were collected over a period of 6 months and KANO model was developed to classify the information into 'must be', 'linear', and 'delight' attributes. It was found that 'must be' attributes include condition of financial statements, current economic indicators, and the result of technical analysis and 'insider information' is a 'delight' attribute. The study revealed the factors are affecting the decision making of investors. The consideration of factors for investment decision making is sector specific and helps various parties in understanding the investment decision behaviour of investors'. [ABSTRACT FROM AUTHOR]

Green investing has recently received considerable attention in India in light of the local government plans to significantly reduce the level of CO 2 emissions through conducting and funding various types of eco-friendly infrastructures and green projects on a national scale. Given that investment in environmentally friendly projects is still relatively new in India, the stock prices of Indian green companies could be highly volatile and very prone to risk transmission from other assets, which requires a precise estimation of the time-varying volatility of these green stocks to understand their underlying risk. In this paper, we examine if the stock volatility of Indian green companies can be predicted based on the information contents of commodity market implied volatility indexes (VIX) by employing a GARCH-based quantile regression model on daily data. The results show that risk significantly transmits from crude oil, gold, and silver markets to various Indian green stock indexes. The impact of the transmission from commodity market VIXs is stronger during the bearish stock market periods compared to bullish stock market periods, suggesting that green stock indexes are more likely to receive volatility from energy and precious metal markets during the periods of high uncertainty. Our findings are useful to socially responsible investors who focus not only on the environmental performance of a firm but also consider its financial performance. [ABSTRACT FROM AUTHOR]

Forward Rate Unbiased Hypothesis (FRUH) has been the subject of intensive scrutiny by researchers. Majority of the work has focused on the forward and the spot rate of the currency of a single country. Cross country FRUH comparison has been rare. This paper is an attempt to fill the lacuna by comparing the FRUH in the Indian and the Tunisian Forex Market. The dataset used in this study consists of 238 weekly observations of the Tunisian and Indian spot and forward exchange rates for the four-year period starting 01 April 2004 to 16 October 2008. Analysis shows that the FRUH does not hold in both the markets. However, FRUH seems to be more severe in the Indian markets than in the Tunisian markets. Furthermore, the slope coefficient's in the Indian case were negative as opposed to the Tunisian case suggesting that India is a more developed economy as compared to Tunisia. Based on our evidences, we highlight some reasons as to why the FRUH fails and suggest areas for further research. [ABSTRACT FROM AUTHOR]

Abstract: This paper applies two alternative methods of estimation, viz., fully modified OLS (FMOLS) and generalized method of moments (GMM), to analyse the determinants of the capital structure of Indian firms using a panel of 1169 non-financial firms listed in either the Bombay Stock Exchange or the National Stock Exchange over the period 1995–2008. The results thus obtained are robust across the estimation methods. Among the three alternative theories of capital structure, the pecking order theory and the static trade-off theory both seem to explain Indian firms’ decisions. However, there is little evidence to support the agency cost theory. [Copyright &y& Elsevier]

Purpose - This paper seeks to investigate whether the "financial highlights" section of annual reports of a sample of Indian companies satisfy the information requirements of investors. Design/methodology/approach - The research method involves the preparation of a check-list from those items that have been suggested as significant to be disclosed in annual reports by both the "sophisticated" and "non-sophisticated" investors as suggested in the study of Joshi and Abdulla. After the preparation of this check-list, "financial highlights" section of a sample of companies listed on any of the Indian Stock Exchanges has been examined to investigate whether this section contains that information, which has been considered as significant by the investors, in the study by Joshi and Abdulla. Findings - Most of the companies do not disclose information items that are perceived by users of financial information in India as being significant under the "financial highlights" section. Research limitations/implications - The limitation of the current study rests on the fact that it uses Joshi and Abdulla for evaluating the "financial highlights" section and hence only considers the need of investors in annual reports and in this specific section. Second, the use of the survey result obtained by Joshi and Abdulla might not hold completely true at the present time due to difference in time period. Originality/value - This is a pioneering study that questions whether the "financial highlights" section in annual reports provides those information items that are considered as "highlights" by investors. [ABSTRACT FROM AUTHOR]

The onset of the COVID-19 pandemic and lockdown announcements by governments have created uncertainty in business operations globally. For the first time, a health shock has impacted the stock markets forcefully. India, one of the major emerging markets, has witnessed a massive fall of around 40% in its major stock indices' value. Therefore, we examined the short-term impact of the pandemic on the Indian stock market's major index (NIFTY50) and its constituent sectors. For our analysis, we used three different models (constant return model, market model, and market-adjusted model) of event study methodology. Our results are heterogeneous and largely depend on the sectors. All the sectors were impacted temporarily, yet the financial sector faced the worst. Sectors like pharma, consumer goods, and IT had positive or limited impacts. We discuss the potential explanations for the same. These results may be useful for investors in safeguarding equity portfolios from unforeseen shocks and making better investment decisions to avoid large, unexpected losses. [ABSTRACT FROM AUTHOR]

The board structure of Indian companies has witnessed a sea change in terms of its size and composition. Our study presents the trends and patterns in board characteristics for the last two decades for the top 500 companies listed on the Bombay Stock Exchange. We have made an attempt to measure variations across different sectors, age groups, and time periods in the mean values of variables by using one-way ANOVA. The differences between mean values and variances of board characteristics have been examined for two different time periods (2002-2010 and 2011-2019) using paired t-test. The contribution of our study is the comprehensive analysis of board trends suggesting significant differences in board size and composition across different sectors and time periods. The significant differences across different sectors also highlight heterogeneity among different sectors which should be taken into account while formulating different policies related to corporate governance. The regulatory reforms can be treated as crucial milestones towards developing stronger corporate governance mechanisms in India and regulators may deliberate on taking the reforms to the next level. Further, future scholars may ponder over the company's strategic choices being followed for the functioning of their internal governance mechanism. [ABSTRACT FROM AUTHOR]