Evaluating Value Investing in Nifty 50 Large Cap Stocks
Year: 2025
Type: article
Abstract: This study delves into the effectiveness of value investing within the realm of large-cap stocks by focusing on companies listedin the NIFTY 50 index that remained consistently from 2014 to 2024. The research employs a multi-factor scoring model,analyzing nine financial ratios over the 2014-2019 period to assess the financial health of these companies. The ratios, includingReturn on Assets (ROA), Cash Flow from Operations (CFO), accruals, and others, were averaged over five years. Eachcompany was assigned an F-Score, with scores ranging from 0 to 1 based on how favorable their financial indicators were. Aportfolio of six companies with F scores between 7 and 9 was then constructed, and its performance over the period 2019 to2024 was compared against overall market returns. The objective of this analysis was to investigate whether a systematicapproach to value investing, utilizing these financial ratios, could lead to market outperformance. Results suggest that thevalue-based portfolio, driven by sound financial fundamentals, can indeed identify stocks that outperform the broader market,offering valuable insights into the applicability and success of value investing strategies in large-cap stocks.
Authors: Prof. Amit Bathia, Mr. Harsh Ghai, Mr. Neel Vazirani, Mr. Saarish Thevar, Mr. Shreesant Tripathy, Mr. Shubham Pachlangia, Mr. Vaibhav Lahoti
Institution: Narsee Monjee Institute of Management Studies
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W6912027403
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