Though an increasing number of companies worldwide are using EVA as a measure of corporate performance, it is often criticized as being a wrong measure of corporate performance. It is often argued that the market forms expectations on the market value of the company and not on the book value of...

While valuing a company using the DCF approach, we face the well-known circularity problem, where we need to know the cost of capital to value a company, and we need to know the value of the company (in particular the market debt-to-equity ratio) to find the cost of capital. Usually, analysts...

Identifying the historical value drivers of a company proves extremely useful while valuing a company. Knowing why a company has done well (or poorly) in the past is very important to understand how the company is going to perform in the future. In this paper we suggest a spreadsheet model that...

Designing a spreadsheet model to explain the portfolio theory is a highly effective way of teaching portfolio theory at an MBA level. A few of the well-known textbooks on Investments do include these spreadsheet models in the book itself. These models however assume that the number of stocks one...

In this paper, we recommend an alternative performance measure based on the true value added (TVA) of a company. We explain our measure using three Indian companies that currently use EVA-based performance evaluation system. We show that our alternative measure can address most of the...

Using nineteen measures of corporate governance, we develop a corporate governance index in this paper. We find that this corporate governance index is positively associated with financial performance measures like Tobin's Q and industry-adjusted excess stock returns of Indian companies. We find...

Analysts usually estimate the cost of capital by using the market capitalization as a proxy for equity, and the book value of debt as a proxy for debt. This method is often justified by arguing that for healthy companies there is not much of a difference between the book and the market values of...

We explore the effect of industry relatedness on the performance of Indian acquirers using both short run and long run performance measures. We argue that mergers and acquisitions are distinct strategies, because of the unique regulatory structure and equity ownership pattern that exists in...