 Promoter Ownership and Performance in Publicly Listed Firms in India: Does Group Affiliation Matter?Ansgar Richter and
Indrani Chakraborty ()
Chapter Chapter 7 in Indian Business Groups and Other Corporations, 2023, pp 175-206 from Springer Abstract: Abstract Many of the largest Indian firms are characterized by promoter ownership, a hybrid form of ownership and governance in which the companies’ founders or their heirs hold controlling stakes, while inviting external minority shareholders to contribute capital, and outside managers to participate in the day-to-day administration of the companies concerned. We analyze a sample of 4056 publicly quoted firms with promoter ownership in India during 2007–2013. We find that in group-affiliated firms, the level of promoter ownership has no effect on performance of firms, as measured by Tobin’s q and return on assets (ROA). However, in stand-alone firms, the level of promoter ownership has a U-shaped relationship with Tobin’s q and no relationship with ROA. Moreover, group-affiliated firms show lower performance than stand-alone firms. This seems to be due to the development of the capital market in post-reform India which has greatly reduced the financing constraints for both group-affiliated and stand-alone firms. Date: 2023 There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:isbchp:978-981-99-5041-6_7 Ordering information: This item can be ordered from DOI: 10.1007/978-981-99-5041-6_7 Access Statistics for this chapter More chapters in India Studies in Business and Economics from Springer |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.