Market Warnings : Learning from the Short-Term Impact of COVID-19 on Stock Market Constituents

Q2 Economics, Econometrics and Finance

Indian Journal of Finance Pub Date : 2023-04-03 DOI:10.17010/ijf/2023/v17i4/170094

C. Sharma, Archana Singh, Rajan Yadav

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引用次数: 0

Abstract

Purpose: The paper investigated the short-term impact of the lockdown announcement due to COVID-19 on various industries in India using firms' stock returns and credit ratings. Design/Methodology: The paper used event study methodology to analyze abnormal returns on stocks and credit rating changes of firms following the lockdown to understand the impact on the debt servicing of firms. Findings: The paper found a heterogeneous impact of lockdown on various industries. Pharmaceuticals, chemicals, FMCGs, and telecom sectors saw positive abnormal returns, while textiles, financial services, construction, services, cement, and automobile sectors were the worst affected. The paper also found that smaller companies were more susceptible to the effects of such lockdowns. Indian subsidiaries of foreign MNCs and Central Government-owned firms fared better than privately-owned domestic firms. The debt servicing ability of firms was unimpacted due to the debt relief package announced to mitigate the impact of the lockdown. Practical Implications: The paper's findings have implications for investors and managers who can make informed decisions in advance to reduce the risk to their investment if such a black swan event is expected. The paper's findings could help policymakers identify sectors that require immediate support due to the disruption from such an event. Originality: The paper is unique in investigating the impact of the lockdown due to COVID-19 on companies across different industries, with different ownership groups and sizes. We have not come across such a detailed study investigating the impact of COVID-19 on various industries in India. © 2023, Associated Management Consultants Pvt. Ltd.. All rights reserved.

查看原文本刊更多论文

市场警告：从新冠肺炎对股市成分的短期影响中吸取教训

目的：该论文利用公司的股票回报率和信用评级，调查了新冠肺炎封锁公告对印度各行业的短期影响。设计/方法：该论文使用事件研究方法分析了封锁后公司的股票异常回报和信用评级变化，以了解对公司偿债的影响。研究结果：该论文发现，封锁对各个行业的影响各不相同。制药、化工、快速消费品和电信行业出现了正异常回报，而纺织、金融服务、建筑、服务、水泥和汽车行业受到的影响最为严重。该论文还发现，规模较小的公司更容易受到此类封锁的影响。外国跨国公司和中央政府所有公司的印度子公司的表现要好于私营国内公司。由于宣布了旨在减轻封锁影响的债务减免计划，企业的偿债能力没有受到影响。实际意义：如果预计会发生这样的黑天鹅事件，该论文的发现对投资者和管理者具有启示，他们可以提前做出明智的决定，以降低投资风险。该论文的研究结果可能有助于决策者确定由于此类事件的干扰而需要立即支持的部门。原创：该论文在调查新冠肺炎封锁对不同行业、不同所有权群体和规模的公司的影响方面具有独特性。我们还没有看到如此详细的研究，调查新冠肺炎对印度各行业的影响。©2023，Associated Management Consultants Pvt.有限公司。保留所有权利。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Indian Journal of Finance Economics, Econometrics and Finance-Economics, Econometrics and Finance (miscellaneous)

CiteScore

1.50

自引率

0.00%

发文量

期刊介绍： a source of sophisticated analysis of developments in the rapidly expanding world of finance, is a double blind peer reviewed refereed monthly journal that publishes articles on a wide variety of topics ranging from corporate to personal finance, insurance to financial economics, and derivatives. It provides a forum for exchange of ideas and techniques among academicians and practitioners and thereby, advances applied research in financial management. The journal, with its mission to promote thinking on various facets of finance, is targeted at academicians, scholars, and professionals associated with the field of finance to promote pragmatic research by disseminating the results of research in finance, accounting, financial economics, and sub - areas such as theory and analysis of fiscal markets and instruments, financial derivatives research, insurance, portfolio selection, credit and market risk, statistical and empirical financial studies based on advanced stochastic methods, financial instruments for risk management, uncertainty, and information in relation to finance.