IC performance of Indian pharmaceutical and textile industry

IC performance of Indian pharmaceutical and textile industry Purpose – The purpose of the present study is to make a comparison of intellectual capital performance between Indian pharmaceutical and textile industry. Further, the study attempts to investigate association between intellectual capital efficiency with financial performance and market valuation. Design/methodology/approach – An empirical study was carried out on data collected from CMIE database Prowess. VAIC was calculated on a select sample of 105, pharmaceutical companies and 102, textile companies. Correlation and OLS regressions models are used on panel data for the analysis. Findings – Results indicated that profitability and intellectual capital are positively associated but no significant relationship is observed between intellectual capital with productivity and market valuation in both industries. In spite of the growing importance of intellectual capital, its reflection is not proportionally observed in the financial performance of the select sample of companies. Research limitations/implications – A more detailed study may be carried out taking the major knowledge‐intensive industries with cross‐section analysis to have better assessments of the results. Practical implications – The present study extends the knowledge of academician and managers about intellectual capital performance and its impact on financial and market performance of the companies. They may enhance the profitability and productivity of the companies by proper utilization of intellectual capital. Originality/value – Present study extends the knowledge of intellectual capital performance and its utilization for increasing the financial and market performance of the companies. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Intellectual Capital Emerald Publishing

IC performance of Indian pharmaceutical and textile industry

Journal of Intellectual Capital, Volume 13 (1): 18 – Jan 13, 2012

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Publisher
Emerald Publishing
Copyright
Copyright © 2012 Emerald Group Publishing Limited. All rights reserved.
ISSN
1469-1930
DOI
10.1108/14691931211196240
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of the present study is to make a comparison of intellectual capital performance between Indian pharmaceutical and textile industry. Further, the study attempts to investigate association between intellectual capital efficiency with financial performance and market valuation. Design/methodology/approach – An empirical study was carried out on data collected from CMIE database Prowess. VAIC was calculated on a select sample of 105, pharmaceutical companies and 102, textile companies. Correlation and OLS regressions models are used on panel data for the analysis. Findings – Results indicated that profitability and intellectual capital are positively associated but no significant relationship is observed between intellectual capital with productivity and market valuation in both industries. In spite of the growing importance of intellectual capital, its reflection is not proportionally observed in the financial performance of the select sample of companies. Research limitations/implications – A more detailed study may be carried out taking the major knowledge‐intensive industries with cross‐section analysis to have better assessments of the results. Practical implications – The present study extends the knowledge of academician and managers about intellectual capital performance and its impact on financial and market performance of the companies. They may enhance the profitability and productivity of the companies by proper utilization of intellectual capital. Originality/value – Present study extends the knowledge of intellectual capital performance and its utilization for increasing the financial and market performance of the companies.

Journal

Journal of Intellectual CapitalEmerald Publishing

Published: Jan 13, 2012

Keywords: Intellectual capital; India; Financial performance; Market valuation, Pharmaceutical industry; Textile industry

References

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