Are Indian FMCG Companies adding Economic Value to its Owners?

Authors

  • K. V. Kiran Kumar International School of Management Excellence (ISME) Bangalore

DOI:

https://doi.org/10.33516/maj.v50i11.90-93p

Abstract

This case study investigates the Economic Value Added, as a Value-based Financial Management approach to measure and evaluate the performance of corporations. The study is conducted on the top 14 FMCG companies from India and attempts to answer whether during FY15 they have been successful in adding value to their shareholders’ wealth o the basis of Stern-Stewart’s approach to EVA. The study also proposes certain EVA-based ratios and demonstrates the computation and interpretation of the same using FMCG companies as sample. The analysis revealed that the FMCG firms by and large have generated excess value except companies like, UBL, Tata Global Beverages and Godrej Industries that have eroded the value.

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Published

2015-11-01

How to Cite

Kiran Kumar, K. V. (2015). Are Indian FMCG Companies adding Economic Value to its Owners?. The Management Accountant Journal, 50(11), 90–93. https://doi.org/10.33516/maj.v50i11.90-93p

Issue

Volume 50, Issue 11, November 2015

Section

Case Study
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Europe PMC

References

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Damodaran, A. (2015). Economic Value Added. Retrieved September 11, 2015, from NYU Stern: http://pages.stern.nyu.edu/adamodar/ New_Home_Page/lectures/eva.html

O'Byrne, S. F. (Spring 1996). EVA® AND MARKET VALUE. Journal of Applied Corporate Finance, 9(1), 116-125.