Volume 11 - Volume 11
Impact of Financial Ratios on Stock Price: Evidence from Indian Listed Banks on NSE
Abstract
This study aims to examine the impact of financial ratios on the stock prices of companies listed on
NIFTY Bank. Nifty Bank is a sub-index of NIFTY 50 and has various listed banks included based on
the criteria given by NSE. This study data has been taken from the period 2010-2019 and taken from
the company annual reports. The analysis is done using panel data regression and other tests to
verify the best model for the dataset. The results obtained from this study show that the capital
adequacy ratio and the dividend payout ratio do not impact the stock price. In contrast, earnings per
share, net NPA ratio, and basic earnings per share, net profit margin, and net interest margin
exhibited a relationship with the stock price. In the Indian context, there is less research available on
this topic, and the idea chosen for the study is original. Along with this, the data collected for the
study and the code used for analysis is original work. New investors can use the results of this study
in the Indian stock market to analyze a stock and take proper investment decisions. Another practical
usage of this study is that banking sector companies can improve their ratios to attract new investors.
Paper Details
PaperID: 2553
Author's Name: Nitish Rane and Pooja Gupta
Volume: Volume 11
Issues: Volume 11
Keywords: Indian Stock Market, Financial Ratios, Regression Analysis, Panel Data, Banking Industry, Investors.
Year: 2021
Month: August
Pages: 5132-5144