Sector-wise Financial Performance Analysis of Multinational Corporations Listed on the Dhaka Stock Exchange
Year: 2024
Type: article
Abstract: This study explores the financial performance of multinational companies listed on the Dhaka Stock Exchange (DSE) using key financial ratios such as Price-to-Earnings (P/E), Price-to-Book (P/B), Dividend Payout Ratio (DPR), and Return on Equity (ROE). It aims to determine whether these companies present better investment opportunities than their domestic counterparts. This study also examines the trend of stock prices during the same period to determine the relationship between these financial ratios and stock price growth. The research uses secondary data collected from the companies' annual and quarterly financial statements and some websites. Specifically, the study involves benchmarking both international and domestic players in the telecommunications, pharmaceutical, cement, food, and allied sectors. The analysis explores that despite having relatively higher P/E and P/B ratios, meaning that the stocks are overpriced, the multinational companies have better dividend payout ratios, ROE, and stock growth than domestic companies. The findings of this paper also reveal that investors on the DSE frequently invest without considering conventional financial ratios, a practice referred to as emotional investing. This research offers valuable insights for investors and fund managers into the factors influencing investment decisions on the Dhaka Stock Exchange, emphasizing the potential benefits of considering multinational companies as viable investment opportunities. This study provides a comprehensive assessment of multinational companies' financial performance on the DSE, contributing to the understanding of investment dynamics in emerging markets.
DOI: 10.61784/jtfe3020
Authors: S.K Md. Anik Hassan Rabby, Nashita Mumtahina
Institution: Bangladesh University of Professionals
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4405627977