Title: Financial determinants of equity share pricing: evidence from BSE 100 Index

Authors: Sarita Yadav; Pankaj Kumar

Addresses: Department of Management Studies, Deenbandhu Chhotu Ram University of Science and Technology, Murthal, Sonepat-131039, Haryana, India ' Department of Management Studies, Deenbandhu Chhotu Ram University of Science and Technology, Murthal, Sonepat-131039, Haryana, India

Abstract: The aim of the study is to examine the impact of financial explanatory variables on the equity share price of companies listed on the Standard and Poor (S&P) BSE 100 Index. A secondary dataset of 16 financial variables is considered for 14 financial years from 2005-2006 to 2018-2019. Panel data regression analysis has been employed, and Hausman results indicated that the fixed effect model is appropriate over the random effect of seeing the impact. Further diagnostic testing revealed that panel data assumptions are violated hence cluster robust standard error test has been employed to correct the assumptions. Results revealed that among 16 financial variables, earning per share, price to book value, book value per share, and dividend per share have a significant positive impact on market price of equity shares, whereas the size of the firm, return on net worth, and dividend yield have shown significant negative impact.

Keywords: stock market; financial variables; equity market price; S&P BSE 100 Index.

DOI: 10.1504/IJEF.2024.135166

International Journal of Electronic Finance, 2024 Vol.13 No.1, pp.83 - 102

Received: 12 Dec 2022
Accepted: 03 Feb 2023
Published online: 01 Dec 2023 *