Varun Dawar

Bio: Varun Dawar is an academic researcher from Institute of Management Technology, Ghaziabad. The author has contributed to research in topics: Cash flow & Dividend policy. The author has an hindex of 5, co-authored 10 publications receiving 188 citations. Previous affiliations of Varun Dawar include University of Delhi.

Agency theory, capital structure and firm performance: some Indian evidence

Abstract: Purpose – Based on the agency theory, the purpose of this paper is to empirically investigate the impact of capital structure choice on firm performance in India as one of the emerging economies. Design/methodology/approach – Fixed effect panel regression model is used to analyse ten years of data (2003-2012) on the sample units, to find the relation between leverage and firm performance after controlling for factors such as size, age, tangibility, growth, liquidity and advertising. Findings – Empirical results suggest that leverage has a negative influence on financial performance of Indian firms, which is in contrast with the assumptions of agency theory as commonly received and accepted in other developed as well as emerging economies. Consequently, postulates of agency theory have to be seen with different perspective in India given the underdeveloped nature of bond markets and dominance of state-owned banks in lending to corporate sector. Practical implications – The findings of the paper will enable...

Bank competition and efficiency: empirical evidence from Indian market

Abstract: Purpose – The study aims to investigate the relationship between competition and efficiency. Using bank-level data for Indian banks, relationship between competition and efficiency is examined by applying the Granger causality test for the period 1996 to 2011. Design/methodology/approach – Lerner Index is a measure of market power and is applied for estimation of competition. Data envelopment analysis technique is applied for measuring efficiency in the Indian banking system along with the Granger causality test to look at the relationship between competition and efficiency. Findings – Results show an increasing trend for competition for the period 1996 to 2004, and after that there is fall in competitive levels. Granger causality tests show that competition positively effects efficiency and vice-versa. Practical implications – This study gives an insight into the relationship between competition and efficiency, thus providing an alternative view to the structure–conduct–performance paradigm. An efficient banking system can positively impact the growth of an economy and, hence, competition and efficiency are important decision parameters for regulators and could help them in decision-making and policy formulation. Originality/value – This study has covered more than 90 per cent of the banking assets for looking at competition and efficiency in the banking sector. Policymakers can try to improve competitive levels in banking so as to improve efficiency in the banking sector which can further help in developing the investment-savings cycle.

Return and Volatility Spillover among Commodity Futures, Stock Market and Exchange Rate: Evidence from India:

Abstract: This article aims to investigate return and volatility spillover among commodity, stock and exchange rate markets. The article further looks into whether there is any change in return and volatilit...

Earnings persistence and stock prices: empirical evidence from an emerging market

Abstract: Purpose – This study aims to investigate the persistence ability of accounting variables, namely, abnormal earnings, book value, accruals and cash flows over a period of time and their valuation relevance in Indian scenario. Design/methodology/approach – The study utilizes the generalized version of the Ohlson model which links market prices with abnormal earnings, book value and earning components (accruals and cash flows). Fixed-effect panel data regression is used to analyze six years of data on the sample units to determine the persistence and valuation relevance. Findings – The findings provide evidence on the construct of persistence and value relevance of earnings and book value of equity in the Indian context. The findings further confirm that investors in India are fixated on earnings and fail to attend separately to the cash flow and accrual components of earnings while undertaking their investment decisions. Practical implications – The empirical findings of the study will enable the analysts a...

The Impact of Corporate Governance on Firm Performance During The COVID-19 Pandemic: Evidence from Malaysia

Abstract: The purpose of this study is to evaluate the effect of COVID-19 on corporate governance attributes and firm performance association This research used a sample of 188 non-financial firms from the Malaysian market for the years 2019-2020 We found that the COVID-19 has affected all firm characteristics including firm performance, governance structure, dividend, liquidity, and leverage level, yet, the difference between prior and post COVID-19 pandemic is not significant Also, the investigation revealed that board size exerts a significant positive impact on firm performance After splitting the sample based on year, however, we found that board size does not matter in the uncertain time of the current crisis, while board diversity appeared to be significantly enhancing firm performance in the crisis time compared to the prior year where it has an inverse association with firm performance in both indicators Board meetings and audit committee meetings seemed to have a significant negative influence on firm performance pre and post-COVID-19 This study contributes to the limited literature by providing the first empirical evidence on the impact of Coronavirus on the firm performance and corporate governance association © Copyright: The Author(s) This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (https://creativecommons org/licenses/by-nc/4 0/) which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited

Volatility Spillover between Stock and ForeignExchange Markets: Indian Evidence

Abstract: The study of volatility spillovers provides useful insights into how information is transmitted from stock market to foreign exchange market and vice versa. This paper explores volatility spillovers between the Indian stock and foreign exchange markets. The results indicate that there exists a bidirectional volatility spillover between the Indian stock market and the foreign exchange market with the exception of S&P CNX NIFTY and S&P CNX 500. The findings of the study also suggest that both the markets move in tandem with each other and there is a long run relationship between these two markets. The results of significant bidirectional volatility spillover suggest that there is an information flow (transmission) between these two markets and both these markets are integrated with each other. Accordingly, financial managers can obtain more insights in the management of their international portfolio affected by these two variables. This should be particularly important to domestic as well as international investors for hedging and diversifying their portfolio.

Capital structure and firm performance: evidence of Germany under IFRS adoption

Abstract: This paper is an attempt to empirically examine the relationship between firm performance and capital structure. The study sample consists of the non-financial firms listed in Germany during the period 1993–2016. The European stock market transition to IFRS in 2005 is also considered as a shifting point that might have influenced the extent of the relationship. We observed that more than 60% of the total assets of German non-financial firms are financed through debt, i.e. they are highly levered compare to similar countries. The results confirm a positive relationship between firm performance and capital structure. We also found that IFRS adoption has led to increased firm performance of our sample, whereas it weakened the relationship between capital structure and firm performance. One plausible explanation for the positive association between capital structure and firm performance is the benefits of the tax shield and the lower costs of issuing debt compared to equity.

Is Bank Income Diversification Beneficial? Evidence from an Emerging Economy

Abstract: This paper examines the impact of bank revenue diversification on the performance of banks in an emerging economy. Using a unique dataset with detailed information on non- interest income, our findings show that, conversely to studies on Western economies, a shift towards non-interest activities increases bank profits and risk-adjusted profits particularly when they are more involved in trading in government securities. Our results also indicate that foreign banks benefit more from such a shift than their domestic counterparts. Moreover, we account for the institutional and regulatory environment advocating loans to SMEs and find that higher involvement in non-interest activities is only beneficial for banks with low exposures to SMEs. Our findings have important policy implications in terms of achieving optimal diversification and lower risk exposure, which might conflict with policies aiming to promote SME lending.