International Research Journal of Commerce , Arts and Science

 ( Online- ISSN 2319 - 9202 )     New DOI : 10.32804/CASIRJ

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IMPACT OF ANNOUNCEMENT OF M&A ON SHARE PRICES OF SELECT BANKING STOCKS IN INDIA APPLYING EVENT ANALYSIS

    1 Author(s):  C.ARUNA

Vol -  12, Issue- 1 ,         Page(s) : 42 - 48  (2021 ) DOI : https://doi.org/10.32804/CASIRJ

Abstract

Mergers and Acquisitions are the corporate strategies increasingly used for improving competitiveness among firms in today's global economy. M&A enable the firms to expand business in new geographical areas, explore new segments in business, thus benefitting with large scale economies of scale. The present study has chosen a sample of 13 mergers and aquisitions in Indian Banking sector during the period 2000-2019.The effect of announcement of merger on stock prices was analyzed for all these stocks. Event study analysis was applied using market model. Average Abnormal Returns(AAR) and Cumulative Average Abnormal Returns(CAAR) were calculated. It was understood that announcement of Merger has no effect on the stock prices.

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Anand, M., & Singh, J. (2008), Impact of merger announcements on shareholders wealth: Evidence from Indian private sector banks, Vikalpa: Journal for Decision Makers, 33(1), 35-54.
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Beena, P. L. (2004). Towards understanding the merger wave in the Indian corporate sector – A comparative perspective, working paper 355, CDS, Trivandrum.

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