Do Financial Indicators Drive Market Value of Firms in the Transition Economies? The Russian Case. (August 2016)

• Record Type: Journal Article
• Authors: Gupta, Jyoti; Bunkanwanicha, Pramuan; Khakimov, Sergey; Spieser, Philippe
• Is Part Of: Journal of emerging market finance. Volume 15:Number 2(2016:May/Aug.)
• Page Start: 225
• Page End: 268
• Publication Date: 2016-08
• Subjects: Market value -- Tobin's Q -- Russia -- emerging markets -- corporate governance -- performance; Banks and banking -- Developing countries -- Periodicals; Financial institutions -- Developing countries -- Periodicals; Securities -- Developing countries -- Periodicals; 332.09172405
• DOI: 10.1177/0972652716645894
• Languages: English
• ISSNs: 0972-6527

Abstract

This article studies the factors which influence market valuation of Russian listed firms. Several financial metrics and corporate governance indicators are analysed. Emphasis is given to multicollinearity and cause-and-effect relationships between independent variables. Main results show that there is no significant correlation between the fundamental financial indicators and the Tobin's Q. However, state ownership, concentration of capital and size are negatively associated with the firm valuation. The evidence suggests that the costs of government ownership outweigh its benefits. JEL classification: G15, G14, C22, F23