Impact Assessment of Industry-wise Investment returns in the Disinvestment Milieu: Experiential Substantiation from CPSEs in India

Investment return is employed to assess the effectiveness of an investment. Thus, investment return helps to evaluate the return of a particular investment in relation to the price of its investment. The Central Public Sector Enterprises (CPSEs) in India have been recognized to serve the broad macro-economic objectives of fiscal augmentation, self-sufficiency in the production, etc. However, these goals could not be achieved up to the chosen level. Accordingly, from the fiscal year 1991-92, the Govt. of India adopted the mechanism of disinvestment of the CPSEs in order to ensure most favorable exploitation of national capital and to increase fruitful competency of the CPSEs in India. In this context, the main objective of this paper is to examine the behavior of industry-wise investment returns of the Indian CPSEs with a view to assess their impact in the uninterrupted disinvestment milieu during the period 2010-11 to 2019-20. The study employed popular accounting ratios and statistical test to measure the impact of investment returns at industry-wise level of the CPSEs in India. On the whole, findings of the study concluded that majority of the selected industries have not shown any significant impact in investment returns. In terms of significant results, negative impacts in investment returns are more than that of positive impacts in investment returns among the selected industries. Further, majority of the negative impacts in investment returns are observed among the industries under manufacturing sector, while most of the positive impacts in investment returns are observed among the industries under service sector. Secondary data is used in the study. Furthermore, consolidated published fiscal data are applied in the study. Therefore, it is subject to all the limitations that are inherent in the consolidated published data. The current study has examined investment returns of the CPSEs at industry-wise level. Hence, this study could be extended at firm level (i.e., company-wise level) by selecting companies within each industry of the CPSEs.