A Study on Impact of Micro Factors on Share Prices of Companies in Sensex

XI Capital Markets Conference, 21-22 December 2012, Indian Institute of Capital Markets (UTIICM)

9 Pages Posted: 3 May 2013

Date Written: December 21, 2012

Abstract

Investment is an essential element for the growth of the country. Investment translates economy into a robust economy. The goal of Financial Management is to maximize the wealth of shareholders. An investor has to make an appropriate decision of which shares are to be purchased or to be sold by examining the Micro factors which determine the fluctuations in the share prices and indirectly the wealth of shareholders.

The present study makes an attempt to identify the relationship between the market price and selected five variables namely EPS, Price-Earnings ratio, Price to book ratio, book value and yield among 27 selected scrips in BSE Sensex. The data is collected by using secondary sources. Prowess database of CMIE is used in collecting data relating to the selected explanatory variables. The data is collected for a period of four years i.e. from 01-04-2008 to 31-03-2012 with quarterly intervals. The scope of the study is confined only to selected explanatory variables and to selected scrips in Sensex. These selected scrips belong to 10 sectors. Correlation and ANOVA are used for analyzing the relationship between the market price and selected explanatory variables.

Keywords: Market Price ,Micro factors, equity shares, demand and supply factors.

Suggested Citation

Divya, K. Hema and Devi, V. Rama, A Study on Impact of Micro Factors on Share Prices of Companies in Sensex (December 21, 2012). XI Capital Markets Conference, 21-22 December 2012, Indian Institute of Capital Markets (UTIICM) . Available at SSRN: https://ssrn.com/abstract=2255439 or http://dx.doi.org/10.2139/ssrn.2255439

V. Rama Devi

KL University ( email )

Vaddeswaram
Guntur, Andhra Pradesh 522502
India

No contact information is available for K. Hema Divya

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