Title: Intellectual capital and its consequences on company performance: a study of Indian sectors

Authors: Raman Deep Singh; Karam Pal Narwal

Addresses: Haryana School of Business, Guru Jambheshwar University of Science and Technology, Hisar, Haryana, India ' Haryana School of Business, Guru Jambheshwar University of Science and Technology, Hisar, Haryana, India

Abstract: The present study analysed the association of intellectual capital components (human, structural and physical capital) with economic, financial and stock market performance in manufacturing, service and technology sector of India. Value added intellectual co-efficient (VAIC™) method has been applied to measure efficiency of intellectual capital. The results of the study evince that human capital efficiency (HCE) is positively associated with financial performance and negatively associated with stock market performance in all sectors respectively. It is also found that structural capital efficiency (SCE) is not playing any role in improving the economic, financial and stock market performance of the companies. Finally, the study shows that capital employed efficiency (CEE) has a significant impact on economic and financial performance of the companies of all the sectors. The study provides useful suggestions to the researchers, academicians, investors and government regarding importance of intellectual capital measurement and its relation with financial performance.

Keywords: intellectual capital measurement; human capital efficiency; HCE; structural capital efficiency; SCE; capital employed efficiency; CEE; stock market performance; economic performance; financial performance; India; organisational performance; firm performance.

DOI: 10.1504/IJLIC.2015.070169

International Journal of Learning and Intellectual Capital, 2015 Vol.12 No.3, pp.300 - 322

Received: 12 Sep 2014
Accepted: 29 Jan 2015
Published online: 28 Jun 2015 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article