The paper deals with relationship between liquidity and profitability ratios in the Czech Republi... more The paper deals with relationship between liquidity and profitability ratios in the Czech Republic to investigate whether there exists correlation (a) within selected liquidity ratios and (b) selected liquidity ratios and selected profitability ratio in the Czech Republic during the period 2003-2013. Empirical data from Bureau van Dijk, Amadeus database were analysed from the point of both time-series and cross-sectional analysis. The main findings of the paper are that correlation within selected liquidity ratios is fairly strong while correlation between selected liquidity ratios and selected profitability ratio is relatively weak.
ABSTRACT The preset study is an attempt to measure the influence of different financial ratios se... more ABSTRACT The preset study is an attempt to measure the influence of different financial ratios selected from different categories like liquidity, activity, and leverage on the profitability of the selected companies. For the purpose of the study, three main producers of steel in India—Steel Authority of India, Rashtriya Ispat Nigam Limited and Tata Steel Limited—are selected for a period of 20 years. Initially, the factor analysis is conducted on all the 15 selected ratios and on the basis of inter correlation matrix the variables (financial ratios) which have the correlation coefficient less than ±6 are excluded from the study. The factor analysis is again conducted on the remaining variables and two factors are extracted. The extracted factors are named suitably. To validate those factors cluster analysis is conducted. Afterwards, to estimate the impact of selected variables on the profitability multiple regression analysis is carried on and a model is predicted for such purpose.
International Journal of Business and Management, 2014
This paper mainly studies the influence of capital structure on firm's performance. This investig... more This paper mainly studies the influence of capital structure on firm's performance. This investigation has been performed on a sample of 36 Bangladeshi firms listed in Dhaka Stock Exchange during the period 2007-2012. We have used four performance measures; earnings per share (EPS), return on equity (ROE), return of asset (ROA) and Tobin's Q; as dependent variables and three capital structure ratios; short-term debt, long-term debt and total debt ratios; as independent variables. Using pooling panel data regression method, we found that EPS is significantly positively related to short-term debt while significantly negatively related to long-term debt. There is significant negative relation between ROA and capital structure. On the other hand, there is no statistically significant relation exists between capital structure and firm's performance as measured by ROE and Tobin's Q. Nonetheless, aside from the positive relation between EPS and STDTA, we can conclude that capital structure has negative impact on firm's performance which is consistent with the proposition of Pecking Order Theory.
International journal of business management and finance research, Dec 2, 2022
The study is an attempt to examine empirically the impact of capital structure on firm performanc... more The study is an attempt to examine empirically the impact of capital structure on firm performance using a data sample of 56 Indian manufacturing firms listed on Bombay Stock Exchange, National Stock Exchange or both during 2010-2022. The study uses three financial performance measures namely return on assets, return on capital employed and earnings per share as dependent variables. The eight capital structure measures such as long-term debt, short-term debt, interest coverage ratio, current ratio, growth, tangibility, non debt tax shield and size are used as independent variables. The data are divided into three sectors including steel, cement and automobile. The correlation analysis and multiple regression analysis are used in the study to estimate the impact of capital structure on firm performance. The empirical result shows that firm performance has a negative relationship with short and long term debt in most of the studied sectors. In the automotive sector, long-term debt is positively related to return on capital employed. Liquidity is negatively related to firm performance in the cement and automotive industries. Non-debt tax shield is positively related to firm performance as measured by return on capital employed and earnings per share in the cement and automotive industries, respectively, while interest coverage ratio is positively correlated with firm performance in the cement industry.
The present study was an attempt to evaluate financial performance of the public sector steel com... more The present study was an attempt to evaluate financial performance of the public sector steel companies in India under liberalized era. To determine the financial soundness of these selected companies namely Steel Authority of India Limited and Rastriya Ispat Nigam Limited ratio analysis and descriptive statistics are applied over financial data for a period of twenty years since 1992-93 to 2010-11. The study was based on secondary data collected from CMIE database and published annual reports of the concerned companies. The available data were analyzed to test the financial health of the companies by using ratio analyses which were broadly selected from four categories such as liquidity, solvency, efficiency and profitability. Various descriptive statistical tests like average (Avg), standard deviation (S.D), maximum (Max), minimum (Min) and coefficient of variation (CV) were also applied in the present study.
Indian steel industry is one of the fastest growing industries and contributes a significant amou... more Indian steel industry is one of the fastest growing industries and contributes a significant amount to the country's GDP. India is the fourth largest steel producer in the world after China, Japan and USA. Indian steel industry is contributing around 2 percent to Gross Domestic Product (GDP) and its weight in the Index of Industrial Production (IIP) is 6.2 percent. The present paper is an endeavor to examine the financial performance of the Indian steel companies and establish the linear relationship between liquidity, leverage, efficiency and profitability of the selected companies. Indian steel companies are selected for the study on the basis of market share in 2008-09 for a period of twenty years ranging from 1991-92 to 2010-2011. The public sector company Steel Authority of India is holding the highest market share followed by Tata Steel Limited, JSW Steel Limited, Essar Steel Limited, JSW Ispat and Steel Limited, Rastriya Ispat Nigam Limited, Jindal Steel and Power Limited...
The present study is envisaged to observe the financial performance of the Indian steel industry ... more The present study is envisaged to observe the financial performance of the Indian steel industry during the post recession period. It examines the financial performance of the industry in terms of different ratios selected from different aspects. 16 companies constitute the sample of the study for a period of 6 years since 2010-11 to 2015-16. Further it also investigates the relation between profitability and other financial metrics like liquidity, solvency and activity ratios. Factor analysis and multiple regression analysis are applied in the present study to facilitate the data analysis. Factor analysis is used in the study to explore the structure in the relationship of the financial variables under the study. Multiple regression analysis is used to examine the impact of liquidity factor on the profitability and it also helps to explore the linear relationship between liquidity and profitability. It has been found that liquidity has an immense positive impact on the profitabilit...
The present paper is an endeavor to critically analyze the financial health of Indian steel compa... more The present paper is an endeavor to critically analyze the financial health of Indian steel companies during pre and post acquisition period. The study is also an endeavor to analysis the impact of acquisition on the acquirer company after such acquisition. Data are collected from audited balance sheet, profit and loss account of the concerned companies, CMIE data base, BSE and NSE and money control.com. To facilitate the study different types of ratios are selected and paired t-test is applied. The result showed that post acquisition liquidity, profitability, efficiency and cash flows of the selected companies' decline in a significant way. Paired t-test is applied in the study at 0.05 significant levels to compare overall financial position of the selected companies during before and after acquisition. Financial ratios of whole sample show there is a significant deterioration in the mean of all selected ratios of acquirer companies. With a series of merger and acquisition taking place in Indian steel industry so far more than a half of the bidder firms demonstrated depressed financial performance in the post acquisition time as compared to pre acquisition period.
Indian steel industry is one of the fastest growing industries and contributes a significant amou... more Indian steel industry is one of the fastest growing industries and contributes a significant amount to the country's GDP. India is the fourth largest steel producer in the world after China, Japan and USA. Indian steel industry is contributing around 2 percent to Gross Domestic Product (GDP) and its weight in the Index of Industrial Production (IIP) is 6.2 percent. The present paper is an endeavor to examine the financial performance of the Indian steel companies and establish the linear relationship between liquidity, leverage, efficiency and profitability of the selected companies. Indian steel companies are selected for the study on the basis of market share in 2008-09 for a period of twenty years ranging
Indian steel companies should understand the relationship between the financial factors and profi... more Indian steel companies should understand the relationship between the financial factors and profit. The paper examines the relationship between the different financial factors like fixed assets, working capital, net worth, financial charges and debt-equity proportion, etc and earnings before interest and tax in the post liberalization era. The study is conducted for 20 years starting from 1992 to 2011. The companies under the study have been selected on the basis of market share and SAIL is holding the highest market share followed by Tata Steel Limited, JSW Steel Limited, Essar Steel Limited and Rastriya Ispat Nigam Limited. The main objective of the study to highlight the linear relationship between earnings before interest and tax and financial indicators and to explore such relationship regression analysis technique is adopted.
Global Business and Management Research: An International Journal
This paper studies the determinants of capital structure choice of Indian steel companies. The ma... more This paper studies the determinants of capital structure choice of Indian steel companies. The main objective of the firm is to explore the most important factors which influence most the choice of capital structure of the steel companies in India. The study is basically empirical in nature. In the present paper 37 Indian steel companies listed under National Stock Market and Bombay Stock Market constitute the sample of study. Correlation and regression analysis are used to explore the relationship between dependent variable leverage and other independent variables like tangibility, size, non-debt tax shield, growth opportunity, profitability and business risk. It is found that tangibility, non-debt tax shield, size and growth opportunity have significant effect of the leverage of the capital structure of the companies. The other two variables, profitability and business risk have insignificant effect on the capital structure of the companies.
Steel is crucial for development of modern economy. Indian steel industry is one of the fastest g... more Steel is crucial for development of modern economy. Indian steel industry is one of the fastest growing industries in the whole world. India is the fifth largest steel producer in the world after China, Japan, USA and Russia. Indian steel industry is contributing around 2 percent to Gross Domestic Product (GDP) and its weight in the Index of Industrial Production (IIP) is 6.2 percent. India now contributes 4% to the world’s crude steel production and is capable of holding and retaining its position in future. If per capita consumption is taken into account then it can be seen that India’s per capita consumption of steel (47 kg) is less compares to the whole world (190 kg). Therefore, there is an immense scope for the Indian steel industry to grow further in future. This paper is an attempt to examine the financial performance of selected Indian steel companies and the impact of liquidity and activity factors on the profitability of the steel industry on the basis of the sample units.
This is an attempt in the present research to find the behavior of the key financial ratios durin... more This is an attempt in the present research to find the behavior of the key financial ratios during pre and post financial crisis period. Indian steel industry suffers from many ups and downs and faced a problem of gradual decrease in demand in global market during the financial turmoil in 2008. Growth in infrastructural development also showed negative figure during this course of time. Because of those problems health of Indian steel industry also suffered. An endeavor is made to conduct a comparative study between pre and post financial crisis period. Several key financial ratios are adopted to facilitate the present research. Factor analysis and correlation analysis are applied to extract the factor from sample profit ratios and show the relationship between extracted factor and other financial ratios selected from different segment like liquidity, solvency and efficiency. Paired t-test is also applied to explain the condition of steel sector before and after financial crisis which showed a minimum difference in the sample ratios between pre and post crisis period except in certain cases.
The present study was an attempt to determine the financially healthy and weak steel companies in... more The present study was an attempt to determine the financially healthy and weak steel companies in India to assess overall industrial condition by applying discriminant analysis for the study period of twenty years since 1991-92 to 2010-11. The study was conducted on ten Indian steel companies whose market share was more than 77 percent in 2009-10. Initially the study as started with eight financial ratios selected from different areas like profitability, liquidity, solvency and efficiency. A strong discriminant function was developed with three ratios found to be significant in discriminating power and classification results. Profitability and efficiency ratios such as return on investment, debtor turnover ratio and fixed assets turnover ratio are most important indicator to distinguish between financially healthy and financially weak companies. Hence, to become financially healthy the steel companies must try to improve return on investment by applying proper debtor and fixed assets management policy in Indian context.
The paper deals with relationship between liquidity and profitability ratios in the Czech Republi... more The paper deals with relationship between liquidity and profitability ratios in the Czech Republic to investigate whether there exists correlation (a) within selected liquidity ratios and (b) selected liquidity ratios and selected profitability ratio in the Czech Republic during the period 2003-2013. Empirical data from Bureau van Dijk, Amadeus database were analysed from the point of both time-series and cross-sectional analysis. The main findings of the paper are that correlation within selected liquidity ratios is fairly strong while correlation between selected liquidity ratios and selected profitability ratio is relatively weak.
ABSTRACT The preset study is an attempt to measure the influence of different financial ratios se... more ABSTRACT The preset study is an attempt to measure the influence of different financial ratios selected from different categories like liquidity, activity, and leverage on the profitability of the selected companies. For the purpose of the study, three main producers of steel in India—Steel Authority of India, Rashtriya Ispat Nigam Limited and Tata Steel Limited—are selected for a period of 20 years. Initially, the factor analysis is conducted on all the 15 selected ratios and on the basis of inter correlation matrix the variables (financial ratios) which have the correlation coefficient less than ±6 are excluded from the study. The factor analysis is again conducted on the remaining variables and two factors are extracted. The extracted factors are named suitably. To validate those factors cluster analysis is conducted. Afterwards, to estimate the impact of selected variables on the profitability multiple regression analysis is carried on and a model is predicted for such purpose.
International Journal of Business and Management, 2014
This paper mainly studies the influence of capital structure on firm's performance. This investig... more This paper mainly studies the influence of capital structure on firm's performance. This investigation has been performed on a sample of 36 Bangladeshi firms listed in Dhaka Stock Exchange during the period 2007-2012. We have used four performance measures; earnings per share (EPS), return on equity (ROE), return of asset (ROA) and Tobin's Q; as dependent variables and three capital structure ratios; short-term debt, long-term debt and total debt ratios; as independent variables. Using pooling panel data regression method, we found that EPS is significantly positively related to short-term debt while significantly negatively related to long-term debt. There is significant negative relation between ROA and capital structure. On the other hand, there is no statistically significant relation exists between capital structure and firm's performance as measured by ROE and Tobin's Q. Nonetheless, aside from the positive relation between EPS and STDTA, we can conclude that capital structure has negative impact on firm's performance which is consistent with the proposition of Pecking Order Theory.
International journal of business management and finance research, Dec 2, 2022
The study is an attempt to examine empirically the impact of capital structure on firm performanc... more The study is an attempt to examine empirically the impact of capital structure on firm performance using a data sample of 56 Indian manufacturing firms listed on Bombay Stock Exchange, National Stock Exchange or both during 2010-2022. The study uses three financial performance measures namely return on assets, return on capital employed and earnings per share as dependent variables. The eight capital structure measures such as long-term debt, short-term debt, interest coverage ratio, current ratio, growth, tangibility, non debt tax shield and size are used as independent variables. The data are divided into three sectors including steel, cement and automobile. The correlation analysis and multiple regression analysis are used in the study to estimate the impact of capital structure on firm performance. The empirical result shows that firm performance has a negative relationship with short and long term debt in most of the studied sectors. In the automotive sector, long-term debt is positively related to return on capital employed. Liquidity is negatively related to firm performance in the cement and automotive industries. Non-debt tax shield is positively related to firm performance as measured by return on capital employed and earnings per share in the cement and automotive industries, respectively, while interest coverage ratio is positively correlated with firm performance in the cement industry.
The present study was an attempt to evaluate financial performance of the public sector steel com... more The present study was an attempt to evaluate financial performance of the public sector steel companies in India under liberalized era. To determine the financial soundness of these selected companies namely Steel Authority of India Limited and Rastriya Ispat Nigam Limited ratio analysis and descriptive statistics are applied over financial data for a period of twenty years since 1992-93 to 2010-11. The study was based on secondary data collected from CMIE database and published annual reports of the concerned companies. The available data were analyzed to test the financial health of the companies by using ratio analyses which were broadly selected from four categories such as liquidity, solvency, efficiency and profitability. Various descriptive statistical tests like average (Avg), standard deviation (S.D), maximum (Max), minimum (Min) and coefficient of variation (CV) were also applied in the present study.
Indian steel industry is one of the fastest growing industries and contributes a significant amou... more Indian steel industry is one of the fastest growing industries and contributes a significant amount to the country's GDP. India is the fourth largest steel producer in the world after China, Japan and USA. Indian steel industry is contributing around 2 percent to Gross Domestic Product (GDP) and its weight in the Index of Industrial Production (IIP) is 6.2 percent. The present paper is an endeavor to examine the financial performance of the Indian steel companies and establish the linear relationship between liquidity, leverage, efficiency and profitability of the selected companies. Indian steel companies are selected for the study on the basis of market share in 2008-09 for a period of twenty years ranging from 1991-92 to 2010-2011. The public sector company Steel Authority of India is holding the highest market share followed by Tata Steel Limited, JSW Steel Limited, Essar Steel Limited, JSW Ispat and Steel Limited, Rastriya Ispat Nigam Limited, Jindal Steel and Power Limited...
The present study is envisaged to observe the financial performance of the Indian steel industry ... more The present study is envisaged to observe the financial performance of the Indian steel industry during the post recession period. It examines the financial performance of the industry in terms of different ratios selected from different aspects. 16 companies constitute the sample of the study for a period of 6 years since 2010-11 to 2015-16. Further it also investigates the relation between profitability and other financial metrics like liquidity, solvency and activity ratios. Factor analysis and multiple regression analysis are applied in the present study to facilitate the data analysis. Factor analysis is used in the study to explore the structure in the relationship of the financial variables under the study. Multiple regression analysis is used to examine the impact of liquidity factor on the profitability and it also helps to explore the linear relationship between liquidity and profitability. It has been found that liquidity has an immense positive impact on the profitabilit...
The present paper is an endeavor to critically analyze the financial health of Indian steel compa... more The present paper is an endeavor to critically analyze the financial health of Indian steel companies during pre and post acquisition period. The study is also an endeavor to analysis the impact of acquisition on the acquirer company after such acquisition. Data are collected from audited balance sheet, profit and loss account of the concerned companies, CMIE data base, BSE and NSE and money control.com. To facilitate the study different types of ratios are selected and paired t-test is applied. The result showed that post acquisition liquidity, profitability, efficiency and cash flows of the selected companies' decline in a significant way. Paired t-test is applied in the study at 0.05 significant levels to compare overall financial position of the selected companies during before and after acquisition. Financial ratios of whole sample show there is a significant deterioration in the mean of all selected ratios of acquirer companies. With a series of merger and acquisition taking place in Indian steel industry so far more than a half of the bidder firms demonstrated depressed financial performance in the post acquisition time as compared to pre acquisition period.
Indian steel industry is one of the fastest growing industries and contributes a significant amou... more Indian steel industry is one of the fastest growing industries and contributes a significant amount to the country's GDP. India is the fourth largest steel producer in the world after China, Japan and USA. Indian steel industry is contributing around 2 percent to Gross Domestic Product (GDP) and its weight in the Index of Industrial Production (IIP) is 6.2 percent. The present paper is an endeavor to examine the financial performance of the Indian steel companies and establish the linear relationship between liquidity, leverage, efficiency and profitability of the selected companies. Indian steel companies are selected for the study on the basis of market share in 2008-09 for a period of twenty years ranging
Indian steel companies should understand the relationship between the financial factors and profi... more Indian steel companies should understand the relationship between the financial factors and profit. The paper examines the relationship between the different financial factors like fixed assets, working capital, net worth, financial charges and debt-equity proportion, etc and earnings before interest and tax in the post liberalization era. The study is conducted for 20 years starting from 1992 to 2011. The companies under the study have been selected on the basis of market share and SAIL is holding the highest market share followed by Tata Steel Limited, JSW Steel Limited, Essar Steel Limited and Rastriya Ispat Nigam Limited. The main objective of the study to highlight the linear relationship between earnings before interest and tax and financial indicators and to explore such relationship regression analysis technique is adopted.
Global Business and Management Research: An International Journal
This paper studies the determinants of capital structure choice of Indian steel companies. The ma... more This paper studies the determinants of capital structure choice of Indian steel companies. The main objective of the firm is to explore the most important factors which influence most the choice of capital structure of the steel companies in India. The study is basically empirical in nature. In the present paper 37 Indian steel companies listed under National Stock Market and Bombay Stock Market constitute the sample of study. Correlation and regression analysis are used to explore the relationship between dependent variable leverage and other independent variables like tangibility, size, non-debt tax shield, growth opportunity, profitability and business risk. It is found that tangibility, non-debt tax shield, size and growth opportunity have significant effect of the leverage of the capital structure of the companies. The other two variables, profitability and business risk have insignificant effect on the capital structure of the companies.
Steel is crucial for development of modern economy. Indian steel industry is one of the fastest g... more Steel is crucial for development of modern economy. Indian steel industry is one of the fastest growing industries in the whole world. India is the fifth largest steel producer in the world after China, Japan, USA and Russia. Indian steel industry is contributing around 2 percent to Gross Domestic Product (GDP) and its weight in the Index of Industrial Production (IIP) is 6.2 percent. India now contributes 4% to the world’s crude steel production and is capable of holding and retaining its position in future. If per capita consumption is taken into account then it can be seen that India’s per capita consumption of steel (47 kg) is less compares to the whole world (190 kg). Therefore, there is an immense scope for the Indian steel industry to grow further in future. This paper is an attempt to examine the financial performance of selected Indian steel companies and the impact of liquidity and activity factors on the profitability of the steel industry on the basis of the sample units.
This is an attempt in the present research to find the behavior of the key financial ratios durin... more This is an attempt in the present research to find the behavior of the key financial ratios during pre and post financial crisis period. Indian steel industry suffers from many ups and downs and faced a problem of gradual decrease in demand in global market during the financial turmoil in 2008. Growth in infrastructural development also showed negative figure during this course of time. Because of those problems health of Indian steel industry also suffered. An endeavor is made to conduct a comparative study between pre and post financial crisis period. Several key financial ratios are adopted to facilitate the present research. Factor analysis and correlation analysis are applied to extract the factor from sample profit ratios and show the relationship between extracted factor and other financial ratios selected from different segment like liquidity, solvency and efficiency. Paired t-test is also applied to explain the condition of steel sector before and after financial crisis which showed a minimum difference in the sample ratios between pre and post crisis period except in certain cases.
The present study was an attempt to determine the financially healthy and weak steel companies in... more The present study was an attempt to determine the financially healthy and weak steel companies in India to assess overall industrial condition by applying discriminant analysis for the study period of twenty years since 1991-92 to 2010-11. The study was conducted on ten Indian steel companies whose market share was more than 77 percent in 2009-10. Initially the study as started with eight financial ratios selected from different areas like profitability, liquidity, solvency and efficiency. A strong discriminant function was developed with three ratios found to be significant in discriminating power and classification results. Profitability and efficiency ratios such as return on investment, debtor turnover ratio and fixed assets turnover ratio are most important indicator to distinguish between financially healthy and financially weak companies. Hence, to become financially healthy the steel companies must try to improve return on investment by applying proper debtor and fixed assets management policy in Indian context.
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Papers by Shrabanti Pal