1、外文文献翻译译文 一、外文原文 原文 ： Do Leverage, Dividend Policy and Profitability influence the Future Value of Firm? Evidence from India INTRODUCTION With the ushering of economic liberalization in 1992, Indian stock market has undergone several changes over the last decade. These include introduction of new exc
2、hanges, massive computerization and electronic limit order book integrating the stock exchanges across the nation, establishing of clearing corporation and subsequent introduction of new derivative products in the market. Perhaps the most important among these changes was the establishment of Securi
3、ties and Exchange Board of India (SEBI) in 1992 as the market watchdog. SEBI, since its inception has strived in the direction of narrowing the information gap between Indian corporations and investors, enforce better corporate governance practices through guidelines, rules and regulations and throu
4、gh active market for corporate control that has marked a new era in the Indian financial arena. The investors reveled their confidence through their participation in the primary and secondary market. Large number of new companies came to the primary market over 1993-96 and the market capitalization
5、of S&PCNX 500 has increased considerably over 1990s. India has emerged as an emerging economy with largest number of companies listed in its stock markets. Over the last decade corporate governance has received considerable importance in Indian financial market. With the initiation of market for cor
6、porate control and activities in the merger and acquisition market, CEOs have assigned tremendous importance for creating value for their firms. Accordingly companies from different sectors (and/or ownership groups) have adopted different strategies to signal their earning and growth potential over
7、the years and thereby influence their stock prices. With this in the background this paper attempts to analyze the factors that influenced the future value of the companies listed in Indian stock markets and also how the effect of these factor changes over different categories of firms. Background L
8、iterature The well-developed and vibrant literature in modern corporate finance has its root in the seminal paper by Franco Modigliani and Merton Miller (1958, 1963), (M-M henceforth). This branch of finance started with the assumption of perfect information and complete markets. It postulates that
9、in a typical neoclassical market with perfect competition, absence of agency costs, transaction and banking costs, the average cost of raising fund for any firm is completely independent of its capital structure. With the same set of assumptions M-M (1963) argued that the value of the firm is unaffe
10、cted by the dividend policy. However, over time many of these simplified assumptions were relaxed and subsequent research showed capital structure does matter and there could exist optimal dividend policy in the modified M-M framework. Academic literature over the last decade has documented the effe
11、ct of different strategic factors influencing the firm values for the developed countries. Rappaport (1981, 1987) has used value creation literature for corporate mergers and acquisition and underlined the importance of growth rate, operating profit, income tax rate and fixed capital investment as t
12、he major factor influencing the firms value. Recently some of the studies concentrated on emerging market to analyze the factors that influenced the firmsvalue in this market. Ben Naceur and Goaied (2002) investigated value creation process for Tunisian stock exchange using a random probit model wit
13、h unbalanced panel data. It considered that the managers succeeded creating value to its share holders if the market value of the share exceeds the book value of the corporation and vice versa. The authors considered three main determinants of value creation: financial policy, profitability and divi
14、dend policy. In the modified M-M framework, literature has shown that firms performance depends on the capital structure (or financial policy). Ross (1977) argued that more leverage would signal the investors about the improved firm prospect and influence the firms value in future. Increase in divid
15、end payout increases the investors income at present and signal the expected future cash flow for the corporation. Profitability is undoubtedly one of the major factors determining the firm value. Ben Naceur and Goaied(2002) argued that while profitability and debt have positive effect on the probab
16、ility of crating future value, the pay-out have reverse effect on the same. India has one of the most developed stock markets in the world with large number of domestic and international players investing in Indian stock market. With maximum number of companies listed in the Indian stock exchanges f
17、rom different industries and different ownership groups (e.g. business affiliated firms, Indian standalone, foreign standalone) and with the emphasis on corporate governance practices, India has become an important and interesting destination for such studies. Among the available studies in this are
18、a, Sahu (2002) used a sample of companies listed in BSE to explain the abnormal stock returns by dividend stability and found no statically significant result. Another study by Tuli and Mittal (2001) used 101 Indian firms and found price earning ratio is significantly influenced by variability of ma
19、rket price and dividend pay out ratio.However, the authors did not find any significant effect of industry and ownership pattern on price to earning ratio. This papers aims at determining the factors influencing the probability of future firm value for Indian corporations after controlling for the i
20、ndustry and time specific effects. In particular this study attempts to answer the following questions:（ 1） How the probability of future value creation is affected by firms profitability, financing pattern and the dividend pay-out policy?（ 2） Whether the firms belonging to business groups have diff
21、erent effect on probability of value creation? Data The primary source of the data for this paper is PROWESS database, compiled by Center for Monitoring the Indian Economy (CMIE). This dataset is similar to the COMPUSTAT database in USA. We have selected the firms that are presently included in S&PCNX 500 index. The accounting and stock price data for these companies are extracted for the year 1989-90 to 2001-02 from Prowess dataset for
