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Determinants of stock price in Nepalese insurance companies / Parbati Paudel
Title : Determinants of stock price in Nepalese insurance companies Material Type: printed text Authors: Parbati Paudel, Author Publication Date: 2017 Pagination: 109p. Size: GRP/Thesis Accompanying material: 9/B Languages : English Descriptors: Share-Price Class number: 332.632 Abstract: The stock market is a primary place to generate funds for newly established firms through the process of initial public offering and existing firms through the trading of listed shares.It contributes in the economic development of country by promoting capital formation and raising economic growth. The fluctuation in stock price creates confusion to the investors in making the rational investment decision. The movement in the stock price occurs because of the several influencing factors that might be firm specific, macro environmental factors, internal and external factors, economic factors. The stock prices can be predicted by technical analysis and fundamental analysis. Knowledge on predicting the future stock price would help the investors to make the profitable investment decision.
This study attempts to analyze the determinants of stock price in Nepalese insurance companies. The study is based on secondary data of 15 insurance companies with 120 observations for the period of 2007/08 to 2014/15.Out of 15 insurance companies five are life insurance companies and remaining ten are non life insurance companies. The main source of data includes statistics report of Insurance Board of Nepal, annual reports of selected Nepalese insurance companies,annual trading report of NEPSE and data bank of World Bank. The research design adopted in this study is descriptive and causal comparative research design as it deals with thedeterminants of stock price in Nepalese insurance companies.
The result shows that average market price per share is highest forNELICL (Rs. 1914.75) and lowest forNBCL(129.38). The average price earnings ratio is highest for NLICL (374.21 times) and lowest for NBICL (6.11times). The average book value per share is highest for SIL (Rs.228.47) and lowest for NBCL (Rs.37.17). The average earnings per share is highest for SIL (Rs. 54.92) and lowest is for NBICL (Rs. -0.56). The average return on asset is highest for SIL (8.98 percent) and lowest is for NBICL (-0.71 percent). The average dividend per share is highest for NELICL (Rs. 45.60) and lowest for UICL,NBICL and SLICL (Rs.0). The average total assets is highest for NELICL (Rs. 12222.88 million) and lowest for NBICL (Rs.256.63 million).The inflationis highest (11.10 percent) in the year 2009/10 and it is lowest (5.70 percent) in the year 2007/08. The gross domestic product is highest (5.90 percent) in the year 2007/8 and lowest (2.30 percent) in the year 2014/15. The money supply is highest 27.30 percent)in the year 2011/12 and it is lowest (12.20 percent) in the year 2008/09.
The descriptive statistics for selected insurance companies shows that the average market price per share, price earnings ratio, book value per share, earnings per share, return on asset, dividend per share,size, inflation, gross domestic product and money supply Rs. 531.05, 60.96 times, Rs. 147.60, 25.22, 4.14 percent, 2730.29 million, 13.08 percent, 9.03 percent, 4.29 percent and Rs. 19.61 respectively.
The correlation matrix shows that book value per share earnings per share, dividend per share, size, money supply and gross domestic product are positively related to market price per share. Whereas, return on assets and inflation are negatively related with market price per share. On the other hand, book value per share, size, gross domestic product and money supply are positively correlated to price earnings ratio. However,earnings per share, return on assets, dividend per share and inflation are negatively related to price earnings ratio.
The regression analysis reveals that book value per share has positive and significant impact on market price per share. This indicates that higher the book value per share higher would be market price per share. Similarly, earning per share has positive and significant impact on market price per share. This shows that that higher the earning per share higher would be market price per share. In addition, dividend per share has positive and significant impact on market price per share. It reveals that higher the dividend per share higher would be the market price per share. Moreover, size has positive and significant impact on market price per share. This reveals that higher the total assets of firm higher would be market price per share. On the other hand, inflation has negative and significant impact on market price per share. However, gross domestic product, and money supply have positive and insignificant impact on market price per share.
Additionally, the study indicates that there is positive and significant impact of book value per share with price earnings ratio.This indicates that higher the book value per share higher would be price earnings ratio. Similarly, earning per share has negative and insignificant impact on price earnings ratio.It states that higher the earnings per share higher would be price earnings ratio.In addition, there is negative and insignificant impact of return on assets on price earnings ratio. This shows that higher the return on assets lower would be price earnings ratio. Moreover, dividend per share has negative and insignificant impact on price earnings ratio. It states that higher the dividend per share higher would be price earnings ratio. Firm size has positive and significant impact on price earnings ratio. It reveals that higher the total assets of firm higher would be the price earnings ratio. However,inflation has negative and significant impact on price earnings ratio.Similarly, there is positive and insignificant impact of gross domestic product and money supply on price earnings ratio.The study reveals that book value per share, size and inflation are major determinants of stock price in Nepalese insurance companies.
Determinants of stock price in Nepalese insurance companies [printed text] / Parbati Paudel, Author . - 2017 . - 109p. ; GRP/Thesis + 9/B.
Languages : English
Descriptors: Share-Price Class number: 332.632 Abstract: The stock market is a primary place to generate funds for newly established firms through the process of initial public offering and existing firms through the trading of listed shares.It contributes in the economic development of country by promoting capital formation and raising economic growth. The fluctuation in stock price creates confusion to the investors in making the rational investment decision. The movement in the stock price occurs because of the several influencing factors that might be firm specific, macro environmental factors, internal and external factors, economic factors. The stock prices can be predicted by technical analysis and fundamental analysis. Knowledge on predicting the future stock price would help the investors to make the profitable investment decision.
This study attempts to analyze the determinants of stock price in Nepalese insurance companies. The study is based on secondary data of 15 insurance companies with 120 observations for the period of 2007/08 to 2014/15.Out of 15 insurance companies five are life insurance companies and remaining ten are non life insurance companies. The main source of data includes statistics report of Insurance Board of Nepal, annual reports of selected Nepalese insurance companies,annual trading report of NEPSE and data bank of World Bank. The research design adopted in this study is descriptive and causal comparative research design as it deals with thedeterminants of stock price in Nepalese insurance companies.
The result shows that average market price per share is highest forNELICL (Rs. 1914.75) and lowest forNBCL(129.38). The average price earnings ratio is highest for NLICL (374.21 times) and lowest for NBICL (6.11times). The average book value per share is highest for SIL (Rs.228.47) and lowest for NBCL (Rs.37.17). The average earnings per share is highest for SIL (Rs. 54.92) and lowest is for NBICL (Rs. -0.56). The average return on asset is highest for SIL (8.98 percent) and lowest is for NBICL (-0.71 percent). The average dividend per share is highest for NELICL (Rs. 45.60) and lowest for UICL,NBICL and SLICL (Rs.0). The average total assets is highest for NELICL (Rs. 12222.88 million) and lowest for NBICL (Rs.256.63 million).The inflationis highest (11.10 percent) in the year 2009/10 and it is lowest (5.70 percent) in the year 2007/08. The gross domestic product is highest (5.90 percent) in the year 2007/8 and lowest (2.30 percent) in the year 2014/15. The money supply is highest 27.30 percent)in the year 2011/12 and it is lowest (12.20 percent) in the year 2008/09.
The descriptive statistics for selected insurance companies shows that the average market price per share, price earnings ratio, book value per share, earnings per share, return on asset, dividend per share,size, inflation, gross domestic product and money supply Rs. 531.05, 60.96 times, Rs. 147.60, 25.22, 4.14 percent, 2730.29 million, 13.08 percent, 9.03 percent, 4.29 percent and Rs. 19.61 respectively.
The correlation matrix shows that book value per share earnings per share, dividend per share, size, money supply and gross domestic product are positively related to market price per share. Whereas, return on assets and inflation are negatively related with market price per share. On the other hand, book value per share, size, gross domestic product and money supply are positively correlated to price earnings ratio. However,earnings per share, return on assets, dividend per share and inflation are negatively related to price earnings ratio.
The regression analysis reveals that book value per share has positive and significant impact on market price per share. This indicates that higher the book value per share higher would be market price per share. Similarly, earning per share has positive and significant impact on market price per share. This shows that that higher the earning per share higher would be market price per share. In addition, dividend per share has positive and significant impact on market price per share. It reveals that higher the dividend per share higher would be the market price per share. Moreover, size has positive and significant impact on market price per share. This reveals that higher the total assets of firm higher would be market price per share. On the other hand, inflation has negative and significant impact on market price per share. However, gross domestic product, and money supply have positive and insignificant impact on market price per share.
Additionally, the study indicates that there is positive and significant impact of book value per share with price earnings ratio.This indicates that higher the book value per share higher would be price earnings ratio. Similarly, earning per share has negative and insignificant impact on price earnings ratio.It states that higher the earnings per share higher would be price earnings ratio.In addition, there is negative and insignificant impact of return on assets on price earnings ratio. This shows that higher the return on assets lower would be price earnings ratio. Moreover, dividend per share has negative and insignificant impact on price earnings ratio. It states that higher the dividend per share higher would be price earnings ratio. Firm size has positive and significant impact on price earnings ratio. It reveals that higher the total assets of firm higher would be the price earnings ratio. However,inflation has negative and significant impact on price earnings ratio.Similarly, there is positive and insignificant impact of gross domestic product and money supply on price earnings ratio.The study reveals that book value per share, size and inflation are major determinants of stock price in Nepalese insurance companies.
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Barcode Call number Media type Location Section Status 337/D 332.632 PAU Thesis/Dissertation Uniglobe Library Social Sciences Available