TY - JOUR
T1 - Corporate Name Change and the Market Valuation of Firms
T2 - Evidence from an Emerging Market
AU - Agnihotri, Arpita
AU - Bhattacharya, Saurabh
N1 - Publisher Copyright:
© 2016 International Journal of the Economics of Business.
PY - 2017/1/2
Y1 - 2017/1/2
N2 - Investors’ responses to a firm’s name change and the determinants of their response are scantly explored areas in the field of behavioral finance. Based on a sample of 415 Indian firms from 2005 to 2014, this study suggests that investors respond positively to the announcement of firm name changes. Furthermore, the study indicates that when firms do not indicate geographical specificity in the name and have a specific rather than generic name, then the firm will experience greater abnormal returns. Also, when firm names are fluent and are associated with the owner’s family name, again, abnormal returns generated are positive. Nevertheless, as a firm ages and investors gain more information about it, then abnormal returns due to name change decrease.
AB - Investors’ responses to a firm’s name change and the determinants of their response are scantly explored areas in the field of behavioral finance. Based on a sample of 415 Indian firms from 2005 to 2014, this study suggests that investors respond positively to the announcement of firm name changes. Furthermore, the study indicates that when firms do not indicate geographical specificity in the name and have a specific rather than generic name, then the firm will experience greater abnormal returns. Also, when firm names are fluent and are associated with the owner’s family name, again, abnormal returns generated are positive. Nevertheless, as a firm ages and investors gain more information about it, then abnormal returns due to name change decrease.
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U2 - 10.1080/13571516.2016.1253186
DO - 10.1080/13571516.2016.1253186
M3 - Article
AN - SCOPUS:84999636221
SN - 1357-1516
VL - 24
SP - 73
EP - 90
JO - International Journal of the Economics of Business
JF - International Journal of the Economics of Business
IS - 1
ER -