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OUTWARD FOREIGN DIRECT INVESTMENT FROM INDIA IN THE SERVICE SECTOR WITH REFERENCE TO IT INDUSTRY
Growing international integration through trade and investment is the emerging scenario of the 21st century. International Investment flows, particularly Foreign Direct Investment (FDI), have become a rising manifestation of this growing global linkage between nations. Outward Foreign Direct Investments (OFDI) from India in the service sector is emerging as a significant aspect of Indias international economic integration. Firms from India are incorporating outward foreign direct investment as part of their corporate strategy to compete globally and to acquire key assets. Outward investments is being adopted as part of their global strategy to emerge as leaders in their respective domain.As the significance of outward investment rises, it is important to understand the motivation and strengths behind such flows. With rising significance of services sector, more studies to explain the nature and factors behind outward FDI assumes importance. Therefore a focus on growth of OFDI from service sector like knowledge??intensive information-technology (IT) sector has become very relevant. IT firms from India have created a global presence and brand image. It is therefore important to consider various factors which give competitive advantage to the firms. The present study is divided into six chapters. The first chapter provides an overview and introduces the research issue. The second chapter comprises of a review of literature in the area. Research Methodology is outlined in the third chapter. The fourth chapter consists of an analysis of the trends in Indian outward foreign direct investment. The fifth chapter provides the analysis and interpretation of factors influencing foreign investments by firms. The sixth chapter gives the summary and conclusions of the study. Results of the study indicate that Indias outward foreign direct investment is showing a rising trend and that there are significant changes in the pattern of these outflows. The outflows by service sector firms have increased and there is also rising investment to developed countries. The changing trend is a reflection of the global aspirations of Indian firms and their willingness to compete in the world market. The study shows that India firms, though small in comparison to multinationals from developed world, do have competitive advantage. They have leveraged these advantages and acquired strategic assets to enhance their competitive position. The firms are gaining from experience and building tacit knowledge. These skills are applied to creating a network to supplement and augment their competitive advantage. In this endeavor, macro factors are also playing a significant role. Technological and information revolution has given firms an opportunity to strengthen their competitive advantage. In this endeavor, firms in developing country like India have benefited from a vast pool of educated, skilled and technically qualified human resource. They have been facilitated by a liberalized government policy and the domestic economic climate, which has given them opportunities for entrepreneurship. Rising outward FDI is a manifestation of these changes. As Indian firms seek to strengthen their competitive positions and augment their assets, the outflow of investment to nations that have intellectual assets will increase. At the same time the traditional motive of undertaking investments to seek larger markets is still important. Though India is still a fledgling in the spectrum of outward investments, Indian firms are fast rising up to the challenge of competitive global atmosphere with aggressive strategies. Indian economy is emerging as one of the largest economies in the world. With the second largest population in the world, India has to utilize every opportunity to build sustainable growth with greater international economic linkages with rest of the world. -
Study On Impact of Employee Retention Strategies on Employee Turnover in IT IndustryAn Exploratory Study in Bangalore
Employee Turnover is a major challenge faced by the companies globally. Employee Turnover is predominant not only in IT sector, but in other sectors as well. This study has focused in IT sector. Employees are the assets of any organization. Organizations are striving to retain their talents by implementing effective retention strategies. High Employee Turnover would subsequently have an impact on productivity and sustainability of the organization. There are two types of Employee Turnover ?? functional and dysfunctional. When productive employees leave the organization, it is said to be dysfunctional turnover and when the poor performers leave, it is called functional turnover. The focus of this study was dysfunctional turnover. Dysfunctional turnover is the concern of HR managers. When an employee leaves, it takes approximately eight weeks for this position to be replaced and in the meantime, productivity suffers. Causes and consequences of the Employee Turnover is mentioned in detail in Chapter 2. This study is an attempt to understand the impact of Retention Strategies on Employee Turnover in IT sector in India. Bangalore, being the IT hub of India, was chosen as the location of the study. Results of the study showed that Retention Strategies has an impact on Employee Turnover. Other variables such as Welfare Benefits, Personal Satisfaction and Organization Culture, which are said to be associated with the Employee Turnover were also investigated as a part of this study. -
Development and validation of analytical methods for the determination of anti-fungal drug in active pharmaceutical ingredient and other dosage forms
A simple and sensitive extractive spectrophotometric method is proposed for the determination of fluconazole drug, in pure form and in the available dosage forms. The method (A) is based on ion-pair formation between the fluconazole and Mo(V)-thiocyanate inorganic complex in the acidic medium and method (B) is based on ion-pair formation between the fluconazole and Co(II)-tetrathiocyanate inorganic complex in the acidic medium. For method (A), the formed coloured ion-pair is extracted with dichloromethane and absorbance is measured quantitatively with maximum absorption at 470nm. The molar absorptivity and Sandells sensitivity of the coloured species are 0.38x104 L mol-1 cm-1 and 0.8 ng cm-2 respectively. Beers law is obeyed between 4.0 -50.0 ?g mL-1 of fluconazole concentration. For method (B) the formed coloured ion-pair is extracted by using a mixture of (3.5:6.5) n-butanol : dichloromethane and the absorbance is measured quantitatively with maximum absorption at 620nm. The molar absorptivity and Sandells sensitivity of the coloured species are 0.268x104 L mol-1 cm-1 and 0.114 ng cm-2 respectively. Beers law is obeyed between 5.5.0-80 ?g mL-1 of fluconazole concentration. The first order derivative spectrophotometric method is also proposed for the determination of fluconazole in pharmaceutical formulations. The proposed methods are successfully applied for the assay of the fluconazole drug in different dosage forms without any interference from common excipients. The results are in good agreement with those obtained by the official pharmacopeial method. Keywords: Spectrophotometry, fluconazole, ion-pair complex, pharmaceutical preparation, molybdenum thiocyanate, cobalt thiocyanate. -
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INVESTOR SENTIMENTS, TRADING BEHAVIOR AND INFORMATIONAL EFFICIENCY IN INDIAN STOCK FUTURES MARKET
The study entitled Investor Sentiments, Trading Behavior and Informational Efficiency in Indian Stock Futures Market shows that the traders in Indian Stock Futures Markets are positive feedback traders-they buy when prices increase and sell when prices decline. Positive Feedback trading appears to be more active in periods of high investor sentiments. Our primary objective is to examine the relationship between the investor sentiments and transitory volatility. The data used in the study is secondary data which is being collected from the National Stock Exchange. The sample period of the study is of past 5 years i.e. from July 2006 to September 2011.The Pharmaceutical sector has been chosen and around seven companies are selected. We used Vector AutoRegression (VAR) Model to test the contemporaneous and causal relationship between order flow, stock return and return volatility. Augmented Dickey Fuller (ADF) and Phillips-Perron (PP) unit root tests have been employed to test the stationarity of the investor sentiment measures. We found that futures market tends to be more liquid in periods of bullish sentiments. We also found that controlling for feedback trading; the persistence of order flow is significantly lower in high sentiment periods. Further the study shows a strong positive relation between investor sentiments and transitory volatility. The result also suggested that stock futures prices tend to follow the underlying efficient price more closely in bullish periods, consistent with increased liquidity in bullish states. Overall, it can be concluded that this study provides new evidence on the link between investor attitudes, trading behavior and price efficiency at the microstructure level. Key Words: Investor Sentiments, Market Efficiency, Futures Market, Volatility, Order . -
A STUDY ON CONSUMER PERCEPTION TOWARDS ORGANIC FOOD PRODUCTS IN BANGALORE
Consumers worldwide are becoming health conscious and are concerned about nutrition (Hart, 2000) and the quality of food consumed. Consumers are also increasingly concerned with food safety issues taking into consideration, the recent salmonella case in Germany and elsewhere. Gil, Gracia and Sanchez (2000) have investigated that consumers are getting health conscious and are paying more attention to qualit y of food consumed. Therefore, food must deliver an added value that are sought after by consumers besides basic hedonistic and functional needs such as nutrition, taste, health, favorable price-quality ratio, etc in the selection of food. This added value may be perceived in the form of ecological, social and individual benefit. Consumer interest in organic and local foods has shown continued growth for the past two decades. Organic food sales in the U.S. have grown at a rate of approximately 20% per year from $1 billion in 1990 to $17 billion in 2006, currently representing about 2.5% of all food sales (Dimitri and Greene, 2002; Klonsky and Greene, 2005; Organic consumers Association, 2007; Organic Trade Association, 2007). In a report on US public opinion, organic food markets evolve at noticeably different rates. For example, the British and German markets have developed at a faster pace as has been investigated by Baker, Thompson and Engelken (2004). Fotopoulos and Krystallis (2002) studied the earlier Greek market which was considered to be a mature market to be lagging behind a decade when compared to the rest of the developed markets. Krystallis and Chryssohoidis (2005) have investigated that a total of 130 countries are engaged in producing certified organic food with 90 of them belonging to the developing countries having a favorable environmental condition for growing organic produce. The organic food market in India is at a nascent stage. Country specific research undertaken by A.C.Neilsen in 2006 has indicated that Indians are among the top ten buyers of food with health supplements but lack access to organic food products. Due to high logistic cost & low volume operation, organic food products are costly. The domestic market is driving organic market in India and 96.7% of Indias 5,85,000 MT of certified organic products produced in 2007 ?? 08 is used in domestic markets. An eight city survey in 2006 has indicated a potential demand to the tune of INR 5.6 billion for organic food products in India (Mukherjee,2008). However, the domestic market is characterized by limited retail presence, low certified branded produce and a small range of organic product offerings with respect to varieties though potential growth is becoming evident. Chen (2007) identified that awareness of organic food products are generally not promoted and public is not well informed. A study on consumer perception towards organic food products may add insight into the nascent but emerging organic food industry in India. The review of related literature in the area of organic food products and consumer perception studied has provided many insights for the study. It has also provided direction in designing the present study. A number of researchers have identified various factors that influence consumer perception of organic food products mainly in developed countries. Some studies have also been undertaken in Asian countries like Malaysia and Indonesia. Very few researchers have attempted to focus in detail the various factors that influence consumer perception towards organic food. Having reviewed several studies and having identified the gap, the investigator felt an imperative need to undertake the present investigation. The sample consisted of 246 respondents across the city of Bangalore. Convenience sampling technique was adopted for selecting the respondents. The questionnaire was developed by the investigator. Pilot study was conducted to test the reliability. The Cronbachs alpha reliabilit y for the scale was 0.790 which is considered as fairly good. The major findings of the study were: 1.Consumers of organic food products evaluate product quality with the price they pay. 2.Demographic variables namely gender has a positive impact on consumer perception towards organic food products while difference in educational qualifications do not have a significant impact. 3.There is significant impact of psychographic factors on overall satisfaction of consumers towards organic food products. 4.Consumers consider organic food products as safe for consumption. 5.The respondents have also felt that organic food products are healthy to consume 6.Consumers generally prefer to consume grain based organic food products followed closely by organic grains and organic fruits. The implication of the study will be to help marketers develop and strategize their offerings of organic food products more effectively and efficiently contributing to the overall well being of the society and the individual consumer. Key Words used in this study: demographic factors, organic food products and psychographic factors influencing consumer perception. -
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ORGANIZATIONAL JUSTICE AND ITS INFLUENCE ON WORK ENGAGEMENT AND TURNOVER INTENTIONSIN IT COMPANIES
Organizational justice is very important because it has been linked to critical organizational processes such as commitment, job satisfaction, citizenship and performance (Colquitt et al.,2001, 2002; Greenberg, 1993; Tatum et al., 2002).Literature suggested that there is an intimate link between leadership style, decision-making, and organizational justice (Bradberry and Tatum,2002; Tatum et al., 2002). Organizational justice is concerned with the ways in which employees determine if they have been treated fairly in their jobs and the ways in which those determinations influence other work-related variables [Moorman, 1991, p. 845]. The research is done to analyze organizational justice and its influence on work engagement and intentions to stay in IT firms. The major objectives of the study: To find out the fairness perception of distributive and procedural justice (organizational justice)of employees in IT organizations, to find out the level of work Engagement of employees in IT Organizations, to find out the turnover intentions of IT employees, to find out if organizational justice influences work engagement and turnover intentions, to find out differences across demographics and organizational justice ,work engagement and turnover intentions. Hypothesis was tested and results discussed. 338 employees of an IT Firm were involved in the present study. The judgmental sampling technique was adopted. Employees with a minimum of two years of experience in the organization was administered the questionnaire. The sample was drawn from the IT industries. The tools adopted for present study were: Perceptions of distributive justice were measured with the Distributive Justice Index, developed by Price and Mueller (1986). This five-item scale measures the degree to which rewards received by employees are perceived to be related to performance inputs. Perceptions of procedural justice were measured using 15 items developed by Niehoff and Moorman (1993), because the scale consists of two factors: systematic and informational justice. Utrecht Work Engagement Scale(Version 1.1 2004,Schaufeli,W.and Bakker, A.)was used to measure work engagement and for turnover intentions the questionnaire was adopted from Dilys Robinson. The major findings of the study were 1. The level of Organizational justice was found to be moderate among the IT professionals. 2. IT Employees perceive procedural justice moderately. They feel that Decisions made by their organizations are to some extent based on certain norms or protocols or system driven which are followed. 3. IT employees perceived Informational procedural justice fairly low. Respondents felt that their concerns were not addressed nor perceived as a serious matter by the organizations. 4.Systematic procedural justice is fairly high in IT companies. There is high consistency in procedures and decisions when they are applied. 5. IT Employees perceive distributive justice fairly moderate. Employees feel that rewards, recognitions, and career opportunities are moderately proportional to their inputs. 6. The level of work engagement was found to be fairly high among the employees in IT organizations. 7. From the dimensions of work engagement, the level of Absorption is fairly high across the IT employees. 8. The level of dedication was found to be moderate among the levels of IT employees. 9. IT employees perceived vigor fairly low which says that the energy level towards the work was pretty down comparing to other dimensions. 10. The most of the respondents were from the age group between 26-30 and among all 338 Reponses, male respondents were higher. CONCLUSION The results of present study indicated that fairness perceptions play a vital role in IT Organizations in terms of increasing Work engagement and lowering their intention to leave their organization. The success of a company depends on the quality, productivity and dedication of an employee and the dedication can be improved by organizations fair treatment. When rewards and recognition are perceived to be systematic, the work engagement increases. Whereas systematic justice influences intention to stay which implies that organizations should drive their policies to be flexible to a certain extent. Fair treatment and justice at the workplace in turn will increase work engagement and lower turnover intentions. -
Critical analysis of inventory management with reference to garments in retailing
The Major focus of this empirical research is to find out the relationships between various factors of inventory management in medium format garment retail shops that affect the sales. Samples of 100 retail shops were surveyed and the data collected was analyzed. Garment retailing is broadly classified under Men??s garment, women??s garments and Kids garments. The garment retail segment has seen good growth in recent years, thanks to the good economic environment in the country. This study is concentrated on medium format garment retailers who are facing lot of problems. Some of the problems are tremendous competitive pressure from large format stores & international brands, increasing overheads and high rentals. To counter these pressures, the medium format retailers must try to consolidate their operations, reduce their overheads like high inventory, faster inventory turnover The empirical results shows that the medium format garment retailers are having a positive outlook even though they are having tough competition. This may be because of the good economy and surge in disposable incomes of the urban population. The study also shows that by managing inventory in a tight manner and using latest technology to manage the store will ensure minimal losses and maximize customer satisfaction leading to higher sales realization. Majority of the retailers placed extra orders to take care of demand uncertainties and errors in forecasting. The average number of customers lost due to non availability of right garment was three customers per day. The study found that there is a mismatch between order frequency and supply frequency leading to higher safety stocks. This must be bridged and suppliers must increase their response time to match retailers order cycles. Shrinkage data was not available with majority of retailers. Medium format retailers are not tracking shrinkage with frequent audits and analysis. Some branded retailers who had some data attributed shrinkage on employee theft and shoplifting as the major cause of shrinkage. Most of the sourcing was done locally since Bangalore is a big manufacturing hub for garments. The mode of transport used was by road using LCVs because of traffic restrictions within the city for HCVs. Almost all retailers had bar code and scanner with offline point of sale software for billing and tracking sales. Latest technologies like radio frequency identification, online software with features like online ordering & tracking were not being used by retailers. The average turnover of medium format retailers was good and their main overhead was the high rentals. Rents in prime locations were exorbitant but unavoidable because these locations were the main shopping areas. Garment retailers must use technology to keep track of their customers, their needs and match tem with right inventory to succeed in this competitive era. -
STUDY ON SENSE OF HUMOR AND WORK CULTURE IN HOTEL INDUSTRY IN BANGALORE
This research focuses two fundamental aspects of sense of humor and work culture in a hotel setting. Work culture is a complex construct in hotels, consisting of different attitudes, perceptions, values and beliefs and plays a significant role in moderating the relationship between sense of humor and work culture. The present investigation was carried out on 156 employees (managers, middle and front line staff)of different private sector hotels in Bangalore. Participants age range was 21 years to 50 years. The major objective of this study was to investigate the relationship between sense of humor and work culture among in hotel industry. Work opinion survey scale developed by Zeynep Aycan (2000) and for sense of humor a seven point scale developed by Paul Mc Ghee was administered. This research concludes that even though the interest in sense of humor by employees has been sporadic, sense of humor remains a pervasive and important topic and has potential of providing significant insights into management and work culture. Keywords: sense of humor, work culture, hotel industry -
Effectiveness of Working Capital Management in Maximizing Profitability of Construction Companies in Bangalore.
Working capital in any organizations has a significant role in driving the business forward.Hence,there is an imminent need for the management of the working capital.The efficiency with which working capital is managed in a business or organization determines the health of the business or the organization.On having an effective working capital management firms tend to be successful and while ineffective working management leads to the failure of the business. Hence, the management of working capital is of great importance. The research study is to evaluate the effectiveness of working capital management in maximizing the profitability of construction companies in Bangalore. The research will analyze the construction companies to establish an understanding of the significance of effective WCM for maximizing the profitability. The working capital is the life blood of a business and an important function of finance that defines and deals with the liquidity of the firm. Also, profitability of firms is another major aspect of business. The research explores the correlation between the working capital and profitability to understand the effectiveness of working capital management in maximizing the profitability. The construction industry is the second largest industry of the country after agriculture. Construction activity is an integral part of a countrys infrastructure and industrial development. It includes hospitals, schools, townships, offices, houses and other buildings; urban infrastructure (including water supply, sewerage, drainage); highways, roads, ports, railways, airports; power systems; irrigation and agriculture systems; telecommunications etc. Covering as it does such a wide spectrum, construction becomes the basic input for socio-economic development.The construction industry generates substantial employment and provides a growth impetus to other sectors through backward and forward linkages. It is, essential therefore, that, this vital activity is nurtured for the healthy growth of the economy. With the present emphasis on creating physical infrastructure, massive investment is planned during the Tenth Plan. The construction industry would play a crucial role in this regard and has to gear itself to meet the challenges.In order to meet the intended investment targets in time, the current capacity of the domestic construction industry would need considerable strengthening. The construction sector has major linkages with the building material industry since construction material accounts for sizeable share of the construction costs these include cement,steel,bricks/tiles,sand/aggregates,fixtures/ fittings, paints and chemicals, construction equipment, petro-products, timber, mineral products, aluminum, glass and plastics. The construction sector is one of the largest employers in the country. In '99-2000, it employed 17.62 million workers, a rise of 6 million over 1993-94. The sector also recorded the highest growth rate in generation of jobs in the last two decades, doubling its share in total employment. -
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A Study of retail service quality expectation of electronic retail stores with reference to Bangalore shoppers
The annual growth rate of Retail sector in India is 46.64 percent. Over the past few years, the Retail sales in India are covering around 30 ?? 35 percent of GDP compared to around 20 percent in US. In the last few years immense growth by this sector was witnessed, the key factors were changing consumer profile and demographics, increase in number of international brand in Indian market, economic implications of the Government increasing urbanization, credit availability, improvement in the infrastructure, increasing investment in technology and real estate building world class environment for consumers. The consumer durables market can be divided into consumer electronics comprising of TV sets, audio systems, VCD players and others; and appliances like washing machine ,microwave ovens, air conditioners. The existing sector stands at an estimated US $ 4.5 Billion with organized retailing being at 5 percent. Due to the growth of this sector and increased demand for the durables that is electronics the need was felt to know what are the customer expectations towards the electronic retail store so that the customers expectation gets fulfilled and this can improve the economic development as a whole. The study attempts to find the shoppers expectation towards retail service quality of electronic retail store in Bangalore. -
WORK LIFE BALANCE: ISSUES AND CHALLENGES IN THE INFORMATION TECHNOLOGY SECTOR
Major issues and challenges in work life balance is the impact of work life balance (WLB) on quality of life (QOL). Work-life balance has always been a concern of those interested in the quality of working life and its relation to broader quality of life. Some other issues and challenges are work-family conflict, impact of work and family stressors and conflicts on the mental health, stress and work life balance etc. Quality of life refers to the favourableness or unfavourableness of a total environment for people. QOL programs are another way in which organisations recognise their responsibility to develop jobs and working conditions that are excellent for people as well as for economic health of the organisation. Work ?? Life Balance is a challenging issue for IT leaders, managers and has also attracted the attention of researchers. Work/life balance, in its broadest sense, is defined as a satisfactory level of involvement or ??fit between the multiple roles in a persons life. In this climate managing the boundary between home and work is becoming more challenging. This study is an attempt to contribute afresh with a new perspective to the field of human resources with special reference to QOL in relation of employees work ?? life balance in IT organizations. It is also an earnest attempt to bridge the gap especially in this area by highlighting the relevance and importance of work ?? life balance and QOL to leadership, senior management, individual and organizations and hoping this study will initiate a series of serious and productive discussion on the subject. The findings and outcome of this research will be beneficial to the IT organizations in India, which is a flourishing industry and contributes significantly to the GDP of the country and the talent pool of the world The sample consisted of 350 IT employees from Bangalore city. The sample consisted both male and female married IT employees. The major findings of the study were: i.Work life balance is having positive correlation with quality of life. ii.It was found that the PLIW has a significant influence on the overall stress of the employees. The other variable does not seem to significantly influence the overall stress of the employees. iii.It was found that there was no significant influence of the work life balance on the life enjoyment of the employees. iv.It was found that there was a significant influence of WIPL and WPLE on the overall quality of life. v.There is no significant influence of work life balance on the overall impression of the employees. vi.There is no significant difference of the dimensions of work life balance and quality of life across age groups. vii.It was found that there was significant difference across age groups for the work/personal life enhancement dimensions. viii.It was found that there was no significant difference across gender for the overall quality of life dimensions. ix.Work life balance is having positive correlation with quality of life. CONCLUSION IT organizations should come up with effective and efficient work ?? life balance policies and programs, this will help reduce the work ?? life conflict for IT employees. Further IT leaders should take initiative to improve the quality of life of their employees as it plays a significant role in the organization to improve individual and organizational performance. -
STUDY ON ORGANIZATIONAL CULTURE IN RELATION TO HUMAN RESOURCE MANAGEMENT PRACTICES IN HOTEL INDUSTRY IN BANGALORE
This research focuses and examines the relationship between organizational culture and human resource management practices in hotel industry in Bangalore. Organizational culture is palpable in any organization which has a diversified work force. Hotel industry is built with employees with various values and beliefs. These factors reflect in the culture and are related with the various human resource management practices. There is a significant relationship between organizational culture and human resource management practices in the hotel industry in Bangalore. There were eleven dimensions of organizational culture and thirteen dimensions of human resource management practices that were considered for examining the relationship between organizational culture and human resource management practices. The sample for the study was 135 mid-level managers of different category of hotels in the geographical location of Bangalore. Organizational culture survey scale developed by Pareek, U. (2003) and human resource management practices scale developed by Sebastian, S., & Patrick, H. A. (2010) was administered for this study. This research concludes by the finding fact that there is significant relationship between organizational culture and human resource management practices in the hotel industry. The study also shows that the culture in hotel industry is narcissistic. Keywords: Organizational culture, Human resource management practices, hotel industry -
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The Impact of Changes in Monetary Variables on Stock Prices of Commercial Banks in India
Commercial banks in India, as agents of the reserve bank of India, are key players in the implementation of exchange rate and interest rates and have huge role to control the inflation in the country. The purpose of this study is to examine impact on banking stocks because of frequent changes in important monetary variables. The concern is whether or not current economic indicators, as reflected in interest rates exchange rates and inflation, can explain banking stock returns. This study considered NSE bank nifty index as banks stocks representative because this bank index consist of all major banks listed in the Indian capital market The explanatory variables in this study considered the three important monetary variables namely foreign exchange rates ,long-term interest rates and inflation rates. This paper tries to find the impact of changes in monetary variables on bank nifty. Also the relationship (long run and short run) between bank nifty and monetary variables has been analysed. Different econometric tools have been applied in the study to attain the objectives. The econometric tools like unit root test, ordinary least squares, Johansen-Juselius (1990) Multivariate Co integration test and Vector error correction model (VECM). Based on the unit root test, it is found that all the variables are used in the study are non stationary at level and become stationary at first differences. Johansen cointegration test prove that there is long run relationship between bank nifty and three monetary variables. Based on the result of Ordinary least squares on vector error correction equation this study find that monetary variables have significant impact on bank stock return, but major portion of the bank nifty movement is explains by its own innovations. And also this study find that changes in foreign exchange rates and long term interest rates are affecting the bank nifty movement negatively. But the whole sale price index or inflation rates does not affect the bank nifty or banks stock price movement significantly. Among the three monetary variables are used in this study foreign exchange rates have high influence on bank stock prices. -
Study on Effect of Overdraft facility on market liquidity and income of private banks in Bangalore
This Dissertation depicts about the use of overdraft facility by the business men/women as customers of the private banks and how it affects the liquidity status and income of those private banks in Bangalore. This study helps the private bankers to identify the financial changes in the annual reports supported by statistical tools depicting the significant changes in relation to market liquidity and the income of the private banks. An overdraft allows an individual to continue withdrawing money even if the account has no funds in it and the bank will cover the checks which would otherwise bounce. The interest on the outstanding balance of an overdraft loan often is lower than credit cards. Market Liquidity is an asset's ability to be sold without causing a significant movement in the price and with minimum loss of value. Referring this meaning to the banks, overdraft plays a small part in changing the interest rates and also incurring a very minimal expense to maintain the OD account for the customers among the banks compared to cash credits and loan repayable on demand which are the major reasons for the influence on bank rates. In order to provide for the overdraft facility to the customers, even though for period of 22 days up to 45 days depending on the respective banks policies, banks must maintain a ready source to compensate the customers demand to withdraw beyond a nil balance. Thus Total Deposits are considered to represent the market liquidity of the banks. Income of private banks mainly in connection to the topic of the study considers only the interest earned on the overdraft for approximate comparison between the overdraft balance and interest earned on it. Thus giving no grounds for confusions as to why net profit or income earned through other sources is not considered. Reason for taking the liquidity and income to compare it with overdraft is that all three factors are of shorts terms in nature. It gives a common ground for significant comparison. It also provides appropriate data for correct statistical analysis giving accurate result. While increase in overdraft balance increases the interest amount earned on it or the banks have to increase the deposits to provide for the increasing overdraft balances. Other than the problem of the study, smooth or turbulent financial periods, behaviour of funds rate in response to declining required reserves, political scandals, bad cheques etc. are the various factors practically influencing the overdraft to affect the private banks market liquidity and income The scope of the study reckons to give the results as an answer for various queries of not only to the selected sample private banks but also to other banks that are providing the overdraft facility. It also helps the other researchers to carry on the further study. The hypothesis is to prove whether or not the overdraft affects the market liquidity and income. Sample size N=20 taken for data analysis includes the five years of the three variables of the study from 17 NSE Listed and 3 non listed private banks located in Bangalore which are available from annual reports the websites of sample banks, pay sites like report junction and CMIE-business beacon. This sample size is accumulated through convenient sampling of non-probabilistic sampling technique. Mainly Correlation is used as Statistical Technique for analysis and other than that, financial analytical tools are also employed i.e. Growth analysis, Peer group comparison and Industrial benchmarking. Through correlation analysis, findings are drawn that the effect of overdraft on market liquidity and as well as the effect of overdraft on income of the 20 banks are highly significant (p<0.01). Thus, the null hypothesis 1 and 2which shows that overdraft does not affect the market liquidity and income is proved otherwise. Increase in overdraft does affect the market liquidity and income positively. -
Cross border Mergers and Acquisitions originating from India: An evaluation of long term post-merger performance of acquiring firms.
This research follows the enhanced M&A activity in the Indian market to trace the impact of outbound international Mergers and Acquisitions (M&A) by Indian firms on the acquiring firm??s shareholders. The research makes a unique contribution in evaluating the long-term financial performance of acquiring firms in cross-border M&As and to detecting the strategic factors of their long-term success. The research used a sample of 91 events covering the period of deals occurring from 2004 to 2009 inclusively. The research used the Buy and Hold Abnormal Returns (BHAR) control firm method to evaluate the performance of firms. The research evaluated BHARs for 1-month, 3-months, 6-months and 12-months post the announcement of the acquisitions. The results obtained for the analysis showed significant negative returns for firms performing a cross border acquisition over a period of 12-months post the acquisition announcement. Hence the research concluded that cross-border acquisitions by firms from India generate negative effects on shareholder value for the acquiring firm??s shareholder, as on 12 months post the acquisition announcement. The above conclusion implies that the firms that perform cross border acquisitions actually perform worse than their counterparts that did not perform a cross border acquisition in the same period The research identified factors of long-term success for cross-border M&As. The results obtained suggest that acquiring firms engaged in cross-border M&As are able to realize efficiency gains and create value for their shareholders, under certain conditions: one when they possess high levels of R&D and secondly when the firm makes an acquisition in a related industry. These results were in accordance with the internalization theory of Buckley and Casson (1976) and Rugman (1981), which state that cross-border M&As help create value for acquiring firms by tapping into their expertise and know-how on international markets. While, Buy and Hold Returns were found to be substantially negative for the subgroup of firms that were larger in size as compared to firms that were relatively smaller in size. The size of the firm was negatively associated with performance of firms post an acquisition announcement and hence larger firms were more likely to fail in an acquisition as compared to smaller firms. Dissertation Layout: The first chapter of the dissertation titled ??Introduction?? primarily covered the conceptual framework, statement of problem and the objectives of the research. The second chapter ??Review of Literature?? covered the review of earlier literature on M&A performance and conclusions and gaps observed in the literature. The third chapter titled??Research Methodology?? covered the hypothesis, data collection and sample description and the methodology for data analysis. The fourth chapter ??Results and Findings?? covering results of the data analysis for the long term returns, strategic factors of M&A success, correlation analysis and regression analysis. The last chapter of the research ??Summary and Conclusions?? covered the summary of all the chapters, major findings of the study, the implications, limitations of the study and the conclusions drawn from the research. Keywords: Mergers and Acquisitions (M&A), cross border acquisitions, post-merger, Abnormal returns and Buy and Hold Abnormal Returns (BHAR),