Title: Market reaction to stock name change announcement in India

Authors: Timcy Sachdeva

Addresses: Vivekananda School of Business Studies, Vivekananda Institute of Professional Studies, Pitampura, Delhi, 110034, India

Abstract: Increasing global contest possesses managed firms' en-path for higher demand for distinctiveness. Variables that are most eligible to uphold competitive supremacy, lead to emergence of company's image. Companies adopt stock name change strategy with a view to achieve corporate image. Name change signals variety of information that impacts the capital market. The present paper investigates stock name change impact on the shareholders wealth of Indian listed companies during 2008-2015. Using event study methodology, the results of the study suggests that on the announcement day abnormal returns were found and around the announcement with insignificant negative abnormal return indicating disapproval of name change. In addition, the type of industry in which the company lies does not create any value to the shareholders due to corporate name change. Further, it is analysed stock name change has no impact on shareholders wealth.

Keywords: stock name change; shareholders wealth; abnormal return; event study; signalling mechanism; India.

DOI: 10.1504/IJPSPM.2020.110988

International Journal of Public Sector Performance Management, 2020 Vol.6 No.6, pp.831 - 842

Received: 13 Aug 2018
Accepted: 30 Dec 2018
Published online: 04 Nov 2020 *

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