06-02-2013, 11:10 AM
Investment and Financing Behaviour of Indian Automobile Manufacturing Industry
ABSTRACT
The study by R.N. Agarwal (1982)37 estimated total inventory investment equation for individual firms in automobile manufacturing industry, which was divided into two sectors─ car-sector and non car-sector. His study was based on the data for 1959-60 through 1978-79. Official Directory of Mumbai Stock Exchange had been the basic source of data. Analysis of two sector revealed that sales and stock-sales ratio were important explanatory variables. Cost of capital and trend were important in only car sector while fixed investment and flows of external funds were significant in non-car sector. Existing stock of inventories was statistically significant in both the sector but contrary to expectations, it possessed negative coefficient. Several other variables as dividends, capacity utilization and liquidity ratio were found to be of no importance in explaining inventory investment behaviour.