Title: Institutional ownership and firm performance: evidence from Indian panel data

Authors: Ruchi Kansil; Archana Singh

Addresses: Delhi School of Management, Delhi Technological University, New Delhi-110042, India ' Delhi School of Management, Delhi Technological University, New Delhi-110042, India

Abstract: The objective of this paper is to investigate the interdependent and interaction of institutional ownership and firm performance in an emerging market using Indian panel data. Two stage simultaneous equations - pooled and panel instrumental regression analysis is applied to the dataset that includes publicly listed Indian non-financial firms listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) as on 31 March 2014. A strong evidence of interrelation between institutional ownership and firm performance is evidenced in the Indian context. The results of fixed effect model confirm the relationship between firm performance and institutional ownership. Leverage and asset structure are joint determinants of firm performance and institutional ownership. However, firm performance impacts institutional ownership in the Indian context and not vice versa. The findings of the study could serve as guidelines for policy makers, institutional investors and the Indian corporate.

Keywords: emerging market; institutional ownership; corporate governance; corporate ownership; firm performance; India.

DOI: 10.1504/IJBEM.2018.092993

International Journal of Business and Emerging Markets, 2018 Vol.10 No.3, pp.250 - 269

Received: 03 Jun 2016
Accepted: 09 Jul 2017
Published online: 04 Jul 2018 *

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