Title: Factors affecting financial performance of Indian firms: an empirical investigation of firms listed on Bombay Stock Exchange

Authors: Mosab I. Tabash; Eissa A. Al-Homaidi; Anwar Ahmad; Najib H.S. Farhan

Addresses: College of Business, Al Ain University, United Arab Emirates ' Faculty of Commerce, Aligarh Muslim University, Aligarh, UP, India ' Faculty of Commerce, Aligarh Muslim University, Aligarh, UP, India ' Faculty of Commerce, Aligarh Muslim University, Aligarh, UP, India

Abstract: The aim of this study is to examine the factors that influence the financial performance of Indian listed companies during the period ranging from 2010 to 2016. The sample size consists of 1598 companies listed in Mumbai Stock Exchange (MSE) in India. Return on assets (ROA), return on equity (ROE), profit after tax (PAT) and earning per share (EPS) are used as proxies for financial performance of Indian firms. The fixed effects regression model results revealed that the leverage ratio, liquidity ratio, size of company and company age have a significant and positive influence on the financial performance of Indian listed companies. The leverage ratio has a positive impact on return on equity (ROE) and negative effect on return on assets (ROA), profit after tax (PAT), and earning per share (EPS). The study recommended that managers should consider the leverage ratio in such a way that improves firms' financial performance. The current study provides useful insights for managers, analysts, regulators, investors, and other interested parties in the performance of Indian listed firms.

Keywords: financial performance; panel data; listed companies; Bombay Stock Exchange; BSE; India.

DOI: 10.1504/IJEPEE.2020.107928

International Journal of Economic Policy in Emerging Economies, 2020 Vol.13 No.2, pp.152 - 172

Received: 03 Nov 2018
Accepted: 10 Sep 2019
Published online: 30 Jun 2020 *

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