Exploration and comparison of traditional financial performance measures of Indian manufacturing industries

Abstract

Purpose: The main objective of this study to compare and access the traditional financial performance measures such as Profits after Tax (PAT), Earnings per Share (EPS), Return on Assets (ROA), Return on Equity (ROE), and Return on Investment (ROI) in Indian manufacturing industries. Design/Methodology: The total 534 Indian manufacturing companies considered for this study and grouped into various industries. Study period started from 1999-2000 to 2017-2018 financial years. Descriptive analysis including t-test is used in research to compare and access traditional financial performance measures of Indian manufacturing industries. Findings: Financial performance measured by traditional accounting-based financial performance measures exhibits sound financial health of Indian manufacturing companies. Though, the financial performance decreases in 2007-2008 but afterward sample companies able to revive the sound financial vitality. Some industries outperform the other as well as aggregate sample companies’ vis-à-vis traditional financial performance measures. The average matrices of industries presents mix results as some are not significantly different whereas, some are significantly different.Originality: This is the first paper which examines the comparison and accessibility of the Traditional Financial Performance Measures in Indian manufacturing industries.