Doctoral Dissertation
Financial Performance and Diversification Strategy of Indian Business Groups; Doctoral Dissertation; Indian Institute of Management (IIM) Calcutta, India, 2001
Abstract
The industrial scenario in India has been and is dominated by business houses. There is a gap in empirical research on the relation between diversification and performance of Indian business groups, both before and after economic liberalization. This study used consolidated financial statement and capital market data of 240 large groups over a period of twelve years to study their performance vis-à-vis their diversification strategy. We found that product diversification was negatively related to shareholder value creation and profitability measures for all the three equal sub-periods of the study, having different economic and competitive conditions. The various management issues behind this are further explored.
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Acknowledgements
The author gratefully acknowledges partial funding of this research project by (a) the Indian Institute of Management (IIM) Calcutta and (b) the Aditya Birla Center of London Business School.
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