We estimate the equity risk premium in India using data for the last 25 years. We address the shortcomings of existing indices by constructing our own total return index for the 1980s and early 1990s. We use our estimates of the extent of financial repression during this period to construct a...

Extensive work has been done on response of stock markets to a variety of events, such as announcement of a firm’s financial results, changes in a firm’s variables. However, little work has been done on response of stock markets to political events. These events, characterized by their...

Board interlocks occur when a director of one organization sits on the board of directors of another organization. The causes and consequences of these interlocks have been much debated in the western literature but comparatively little is known about interlocks in Indian corporate boards. Board...

This working paper reports an investigation into the decision making process of individual faced with a set of risky investment opportunities. An experiment was conducted on a set of students and the data generated from the experiment was analyzed. The analysis was done to infer about the...

Indian convertible bonds have two peculiar features that make them possibly unique in the world: a) the bonds are compulsorily converted into equity without any option, and b) the conversion terms are not specified at the time of issue but are left to be determined subsequently by the Controller...

Theoretical models in finance are many a time based on unrealistic assumptions about the behaviour of individuals. Empirical validation of the models is expected to vindicate the assumptions. However, in most situations, the approaches used for empirical validations suffer from serious...

Petronet India Limited (PIL) was created to give impetus to investments in pipeline projects for transportation of petroleum products in the country. Since these projects have a long life and require large investments, correct assessment of location, capacity and financial viability are of...

The term "securities scam" refers to a diversion of funds to the tune of over Rs. 3500 crores from the banking system to various stockbrokers in a series of transactions (primarily in Government securities) during the period April 1991 to May 1992. The scam has for several months become a...

The paper presents application of Markov Chains to management of leasing. The paper demonstrates that, despite low percentage of bad debts, there could be a significant reduction in the returns earned by a lessor because of delays in payment. Since a lessor typically operates with a very small...

At a time of runaway inflation, when nothing seems to contain the pace of its gallop, it might be pertinent to look around for an investment which may shield the value of the investor’s money against the devaluing onslaught of inflation gone amuck. In the west common stocks have often been...