10th Students' Research Symposium 2021
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Item The Impact of Free Cash Flow on Capital Expenditure of Listed Companies un CSE (With Special Reference to the Capital Goods Sector)(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Kahandawala, K.A.D.B.H.; Ranjani, R.P.C.Introduction: Free Cash flow can be considered as one of the major implications of the financial strength of a company. Companies in their introductory stage allocate a higher portion from their funds into capital expenses because they are in the infant stage and need growth. Therefore, they have to increase their capacity level more and more by investing funds in profitable projects. Even though, there are large number of studies have been conducted in developed and developing countries on this topic, no research study conducted in capital goods sector in Sri Lanka. Therefore, this study attempts to examine the impact of free cash flow on capital expenditure of listed companies in the capital goods sector in CSE. Design/Methodology/Approach: The sample of the study consist with 25 companies from capital goods sector in Colombo Stock Exchange and the data was collected over the period of 2011 to 2020. Capital expenditure was taken as dependent variable and free cash flow was taken as the main independent variable and dividends, depreciation, and total assets were considered as control variables. The study used panel data regression and descriptive statistic to analyse the data. Findings: The study revealed that the free cash flow has a significant negative impact on capital expenditure in companies listed in the capital goods sector in Colombo Stock Exchange. In contrast, Dividend, depreciation and total assets have a significant positive impact on capital expenditure in companies listed in the capital goods sector in Colombo Stock Exchange. Conclusion: The final result emphasizes that there is a significant negative impact of free cash flow on capital expenditure in listed companies in Capital Goods sector in Sri Lankan context.Item Dividend Policy and Firm Performance of Banking and Finance Companies in Sri Lanka(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Samarasinghe, K.I.L.; Ranjani, R.P.C.Introduction: Companies' dividends are considered significant because of the information value of dividends. This study focuses on relationship between dividend policy and firm performance of banking and finance sector companies listed in Colombo Stock Exchange. Design/Methodology/Approach: The Sample of 20 banking and finance sector companies was selected based on Market Capitalization, Dividend Declaration and Availability of Annual Reports for 10-year time period. Regression, Correlation Analysis and Descriptive Statistic were used to analyse the data. Econometrics Views (E-Views) Statistical package was used to analyse the data. Findings: The findings indicate that. there is no significant relationship between EPS and Firm Performance and there is a significant relationship between DPO, DPS and Firm Performance. Conclusion: As per the results of the analysis it can be concluded that dividend pay-out ratio and dividend per share have significant impact on performance and there is no significant relationship between earning per share and performance of Banking and Finance sector companies in Colombo Stock Exchange in Sri Lanka.Item The Impact of Ownership Concentration on Firm Performance: Evidence from Listed Hotels in Colombo Stock Exchange(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Perera, D.M.M.P.; Ranjani, R.P.C.Introduction: Ownership concentration is the major internal component in the corporate governance to control the agency issue. The concentration of ownership acts as an invisible hand in improving the firm performance. The purpose of this study is to investigate the impact of ownership concentration on firm performance of listed hotels on Colombo Stock Exchange in Tourism sector in Sri Lanka. Design/Methodology/Approach: The sample of the study consist with twenty-one listed hotels on Colombo Stock Exchange for a time period of 2014 to 2020. The independent variable of ownership concentration measured through percentage of shares held by largest shareholder of the company whereas dependent variable of firm performance was measured through return on asset. Firm size, Financial Leverage & firm age used as the control variables. Descriptive analysis, Correlation analysis and panel data regression used to analyse the data in the study. Findings: The results revealed that ownership concentration has negative insignificant impact on firm performance measured through ROA. However, results indicate that firm age has negative significant impact on ROA. But firm size and financial leverage showed negative insignificant impact on firm performance of listed hotels in Colombo Stock Exchange in Tourism sector of Sri Lanka. Conclusion: The results of the study indicate that ownership concentration does not have significant effect on firm performance of listed hotels in tourism sector of Sri LankaItem Covid 19 and Financial Performance-Evidence from Companies Listed in Colombo Stock Exchange(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Lakshan, B.T.; Ranjani, R.P.C.Introduction: The COVID-19 pandemic has had a significant economic impact not only to Sri Lanka but also around the world. One of the effects of the COVID-19 pandemic on Sri Lankan's Gross domestic production (GDP) growth is fall in 16.4% in the second quarter of 2020 once pandemic started to spread in Sri Lanka. (CBSL, 2020). The purpose of this study is to see how the COVID-19 pandemic has affected the financial performance of companies listed in the Colombo Stock Exchange. Design/Methodology/Approach: The sample consists of 143 firms, which are split into fifteen sectors proportionately. The data are collected over 2019/20 financial statements as per before the Covid 19 and 2020/21 financial statements as per during the Covid 19. The variables are profitability ratio, leverage ratio, short-term activity ratio, and liquidity ratio which are used to check whether there is a statistically significant difference between before and during the Covid 19 pandemic. Data are evaluated through the Wilcoxon Singed rank test between two sets of paired data. Findings: Based on the result, there is a statistically significant difference in the profitability of the companies during the Covid 19 pandemics when compared to before Covid 19 pandemics. And leverage ratio, short-term activity ratio, and liquidity ratio are not statistically significant difference with the Covid 19. Conclusion: As per the results of the analysis, Covid 19 pandemic has significantly impacted to the profitability of the companies listed in the Colombo Stock Exchange. There is no significant impact of the Covid 19 pandemic to the leverage, Liquidity, and short-term activity ratio of the companies.Item Firm Performance During Covid-19 Outbreak Evidence from S&P SL20 Companies(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Fernando, A.N.J; Ranjani, R.P.C.Introduction: Covid-19 pandemic is a one of main challenge faced by entire world in this century. With the general knowledge about the Covid-19 pandemic most of them know that every economic system had subjected to fall from 2019 November onwards. Sri Lanka economy also highly threat by this pandemic from 2020 March onwards. So, it is important to know how top performing listed entities in Sri Lanka able to manage these impacts from the Covid-19 pandemic. Design/Methodology/Approach: Hence study focus on S&P SL20, sample of this study limited to 20 observations with two time periods 2019 as before Covid-19 pandemic and 2020 financial year as during the Covid-19 pandemic in Sri Lankan context. Using Regression analysis & Paired T test overall investigation conducted. Findings: The overall regression model is significant, and it ensures that there is 75% describing ability of ROA by the explanatory variables of the model. Further paired t test statistics conclude that Firm size, Leverage levels, Debt repayment ability, Liquidity positions are not significantly difference but ROA has a significant mean difference during the Covid-19 pandemic period compare with the pre-Covid period. Conclusion: In overall, sectors like travel & tourism, imported related manufacturing industry are not safe havens for the investments as a wise investor. But telecommunication sector, health sector and export related companies are much suitable companies for future investments until the effects of the pandemic gain under fully control.Item Impact of Dividend Announcement on Share Prices in Colombo Stock Exchange(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Deshapriya, D.M.C.; Ranjani, R.P.C.Introduction: Dividend announcement plays a potential role in seeking investment by various investors. Investors who are interested in buying shares primarily consider stock price, risk, leverage, company dividends, profitability, and other factors. The share price is very important to make a decision regarding buying and selling shares. As well as the Dividend announcement is a crucial factor influencing investor decision-making. This study was undertaken due to the inconclusive findings regarding the impact of dividend announcement on share price in the Sri Lankan context. Design/Methodology/Approach: The standard event study methodology was used to examine the stock market response to dividend announcements for the event period of 21 days which is 10 days prior to the announcement date, 10 days after the announcement date, and the announcement date. Both event study method and regression analysis methods were applied to analyze collected data in relation to computing the abnormal return, excess return, cumulative average abnormal return, and t values surrounding the dividend announcement day. Findings: The finding shows that Dividend Announcements lead to positive market reactions towards Market Prices in the Colombo Stock Exchange. Conclusion: When using the descriptive analysis, the dividend announcements show a significant impact on the share prices. As a result, it can be concluded that dividend announcements lead to positive market reactions.Item The Impact of Intellectual Capital on Firm Value: A Comparative Study of Consumer Services Companies and Capital Goods Companies Listed in CSE(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Dharmakeerthi, M.M.K.S.; Ranjani, R.P.C.Introduction: In modern economic era, Intellectual capital is a key competitive advantage for a company. This study was undertaken with the purpose of investigating the impact of Intellectual Capital on Firm value in Consumer Service Sector & Capital Goods Sector companies listed in Colombo Stock Exchange (CSE). Design/Methodology/Approach: This study is for the period of 2015 to 2020 based on the sample of 25 companies in Consumer Service Sector and 20 companies in Capital Goods Sector. Dependent variable for the study was Firm value and independent variable for model 01 was intellectual capital and the independent variables for model 02 were capital employed efficiency, human capital efficiency & structural capital efficiency. Based on the research objectives, the study is tested as two regression models using random effect regression model. Findings: The findings of the study evident that, the intellectual capital has a significant impact on firm value in both consumer service sector and capital goods sector. When consider about component wise impact, capital employed efficiency has a significant impact on firm value and human capital efficiency and structural capital efficiency have not a significant impact on firm value in both sectors. Conclusion: The results conclude that the overall model is statistically significant in both sectors, and there is an impact of intellectual capital on firm value in Consumer Service Sector & Capital Goods Sector in CSE Sri Lanka.Item Impact of Covid-19 Pandemic to The Resilience of Commercial Banks in Sri Lanka Before and During the Pandemic(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Abeywardhana, W.G.S.; Ranjani, R.P.C.Introduction: A resilient banking sector, according to the Basel Committee study, is one that has a high capacity to resist shocks caused by various financial and economic crises. This research study was undertaken to investigate the Impact of covid-19 pandemic to the resilience of Commercial banks in Sri Lanka before and during the pandemic. Design/Methodology/Approach: The Sample of the study consist with ten commercial banks in Sri Lanka and use secondary data those data was collected over the period of 2019 to 2020 from Colombo Stock Exchange. There are three variables use to determine the impact of covid-19. Those are Capital adequacy, Liquidity and Profitability. Descriptive test, Normality test, correlation test has been tested through StataSE13 application. Paired t test and Wilcoxon sign rank test respectively use as parametric test and non-parametric test. Findings: This study identified that there is no significant impact to capital adequacy, liquidity, and profitability from covid-19 pandemic. Conclusion: The final result emphasizes that the overall model is not statistically significant, and researcher conclude that there is no significant impact from covid-19 pandemic to the resilience of commercial banks in Sri Lanka before and during the pandemic.