Exploration and comparison of value-based financial performance measures of Indian manufacturing industries

Abstract

The main objective of this study to compare and access the value-based financial performance measures such as Economic Value Added (EVA), Cash Value Added (CVA), Shareholders Value Added (SVA), Cash Flow Return on Investment (CFROI), and Economic Profit (EP) in Indian manufacturing industries. Design/Methodology: The total 534 Indian manufacturing companies considered for the study and these grouped into various industries. Study period started from 1999-2000 to 2017-2018 financial years. Descriptive analysis including t-test is used as a statistical tool to compare and access valuebased financial performance measures of Indian manufacturing companies. Findings: Financial performance measured by Value-based financial performance measures exhibits sound financial health of Indian manufacturing companies. Though, the financial performance decreases in 2007-2008 but afterward sample companies able to revive the sound financial vitality. Some industries outperform the other as well as aggregate sample companies' vis-à-vis value-based financial performance measures. The average of matrices of industries presents mix results as some are not significantly different whereas, some are significantly different. Originality: This is the first paper which examines the comparison and accessibility of the value-based financial performance measures in Indian manufacturing industries.