Title: The impact of intellectual capital on financial performance for selected Indian pharmaceutical companies

Authors: R.S. Mangayarkarasi; C. Mugunthan

Addresses: Department of Commerce, Periyar University Centre for Post-Graduate and Research Studies, Dharmapuri – 635 205, Tamil Nadu, India ' Department of Commerce, Periyar University Centre for Post-Graduate and Research Studies, Dharmapuri – 635 205, Tamil Nadu, India

Abstract: This paper analyses, in light of the evolving Indian pharmaceutical business, the critical relationship between financial success and intellectual capital. The study compares the effects of intellectual capital components on key financial measures for distinct organisations. This study is based on the relational, structural, and human capital framework of intellectual capital. Thus, this study suggests increasing overall resource investment to boost revenues. Few studies have examined the sensitivity and comparability of financial performance and returns on equity for Indian pharmaceutical enterprises. For Indian pharmaceutical businesses, this procedure examines return on equity, operating profit margin, gross profit margin, net profit margin, total asset turnover, and financial leverage. The study discovered a strong positive association between intellectual capital and financial performance. The report suggests policymakers, regulators, and directors invest in intellectual capital to boost financial success. This study compares Sun Pharmaceutical Industries Limited, Torrent Pharmaceuticals Limited, Dr. Laboratories Reddy's Limited, Divi's Laboratories Limited, and Cipla Limited. The companies were chosen by market cap. A selection of pharmaceutical businesses' 2019-2023 net profit, earnings per share, operational profit margins, and annual sales growth are examined in this study.

Keywords: Indian pharmaceutical; intellectual capital; financial performance; Dupont model; encompasses relational; structural and human capital; theoretical foundation; pharmaceutical businesses; India.

DOI: 10.1504/IJIPM.2025.145167

International Journal of Intellectual Property Management, 2025 Vol.15 No.1, pp.77 - 99

Received: 26 Dec 2023
Accepted: 19 Feb 2024
Published online: 24 Mar 2025 *