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CHAPTER 7
IMPACT OF FDI ON THE GROWTH OF PHARMACEUTICAL
SECTOR IN INDIA
This Chapter deals with assessing the impact of FDI on the Growth of
Pharmaceutical Sector in India. Promoters pattern i.e percentage of
Foreign Promoters in the capital structure of the companies (based upon
IMF, BOP, Definition) and amount of FDI separately have been
considered as independent variables and selected financial ratios and
variables are considered as dependent variables. Simple regression
analysis has been run using SPSS 16.0 version to assess the impact of
FDI on the growth of Indian Pharmaceutical Sector.
Eighteen (18) FDI-based companies, consistently listed have been
considered for the study. The analysis has been carried out for the
companies on both individual basis and aggregate basis. This Chapter is
divided into two (2) parts. Part I and Part II
Part I: It deals with assessing the Impact of FDI (Rs. Crores)) on Select
Financial Variables (Rs. Crores) considering Individual and Aggregate
parameters
Part II: It deals with assessing the Impact of FDI (foreign promoter quota)
on the Financial Performance ( both expressed in percentages) of Selected
FDI-based Pharmaceutical Companies considering Individual and
Aggregate parameters
271
Part I:
7.1 IMPACT OF FDI (QUANTUM) ON SELECT FINANCIAL VARIABLES:
AN ANALYSIS BASED ON INDIVIDUAL PARAMETERS
In case of individual analysis, FDI (amount in Rupees crores) is considered as
independent variable and selected variables (amount in Rupees crores) as
dependent variables. 18 FDI based companies have been considered for the
purpose of analysis . For each company FDI is considered as independent
variable and selected three (3) financial variables i.e Sales, PBIT and Capital
employed are considered as dependent variables.
7.1.1 Impact of FDI on Sales:
The regression analysis run to assess the impact of FDI on sales of FDI-based
companies reveal that FDI significantly influences the sales in the case of
following companies (see table 7.1a and 7.1b)
• Astrazeneca Pharma India Ltd with an R square value of .451 and beta(t)
value of 2.565 with significance value of .033
• Fulford (India) Ltd with an R square value of .692 and beta(t) value of
4.244 with significance value of .003
• Glaxosmithkline Pharmaceuticals Ltd with an R square value of .833 and
beta(t) value of 6.328 with significance value of .000
• K D L Biotech Ltd with an R square value of .708 and beta(t) value of
4.407 with significance value of .002
• Merck Ltd with an R square value of .453 and beta(t) value of 2.576 with
significance value of .033
272
• Novartis India Ltd with an R square value of .424 and beta(t) value of
2.428 with significance value of .041
• Pfizer Ltd with an R square value of .440 and beta(t) value of 2.505 with
significance value of .037
• Solvay Pharma India Ltd with an R square value of .667 and beta(t) value
of 3.744 with significance value of .007
Table: 7.1a FDI and Sales Model Summary
Company Model R R Square
Adjusted R Square
Std. Error of the Estimate
Abbott India 1 195a .038 -.082 152.920147
Astrazeneca Pharma India Ltd 1 .672a .451 .383 87.698025
Aventis Pharma Ltd. 1 .404a .164 .059 204.433428
Biocon Ltd. 1 .691a .478 .347 145.571391
Fresenius Kabi Oncology Ltd 1 .513a .263 -.106 85.533441
Fulford (India) Ltd 1 .832a .692 .654 17.022585
Glaxosmithkline Pharmaceuticals Ltd. 1 .913a .833 .813 148.870507
Kerala Ayurveda Ltd. 1 .648a .420 .324 47.743567
K D L Biotech Ltd. 1 .842a .708 .672 2.174625
Matrix Laboratories Ltd. 1 .666a .443 .258 287.644803
Merck Ltd. 1 .673a .453 .385 40.987064
Novartis India Ltd. 1 .651a .424 .352 54.421246
Pfizer Ltd. 1 .663a .440 .369 132.372113
Solvay Pharma India Ltd. 1 .817a .667 .619 36.428258
Wanbury Ltd. 1 .216a .047 -.271 124.021940
Wyeth Ltd 1 .220a .049 -.070 36.923387
273
Table: 7.1b FDI and Sales
Coefficients
Company Model Unstandardized
Coefficients Standardized Coefficients t Sig.
B Std. Error Beta
Abbott India 1 (Constant) -52.050 1030.949 -.050 .961
FDI 61.516 109.310 .195 .563 .589
Astrazeneca Pharma India Ltd
1 (Constant) -165.426 160.124 -1.033 .332
FDI 97.345 37.945 .672 2.565 .033
Aventis Pharma Ltd.
1 (Constant) -529.946 1072.482 -.494 .634
FDI 113.714 90.903 .404 1.251 .246
Biocon Ltd. 1 (Constant) 546.063 189.447 2.882 .045
FDI 24.541 12.834 .691 1.912 .128
Fresenius Kabi Oncology Ltd
1 (Constant) 281.476 60.501 4.652 .043
FDI 5.075 6.009 .513 .844 .487
Fulford (India) Ltd 1 (Constant) 55.209 22.707 2.431 .041
FDI 58.618 13.814 .832 4.244 .003
Glaxosmithkline Pharmaceuticals Ltd.
1 (Constant) -1308.823 442.802 -2.956 .018
FDI 70.162 11.088 .913 6.328 .000
Kerala Ayurveda Ltd. 1 (Constant) 408.064 138.675 2.943 .026
FDI -55.713 26.720 -.648 -2.085 .082
K D L Biotech Ltd. 1 (Constant) 11.299 1.020 11.075 .000
FDI 1.044 .237 .842 4.407 .002
Matrix Laboratories Ltd. 1 (Constant) 261.285 458.491 .570 .609
FDI 37.372 24.183 .666 1.545 .220
Merck Ltd. 1 (Constant) -4785214.411 1857480.7
38 -2.576 .033
FDI 556555.556 216020.796 .673 2.576 .033
Novartis India Ltd. 1 (Constant) 249.668 121.622 2.053 .074
FDI 34.201 14.087 .651 2.428 .041
Pfizer Ltd. 1 (Constant) 278.040 162.929 1.707 .126
FDI 32.463 12.961 .663 2.505 .037
Solvay Pharma India Ltd.
1 (Constant) -1094.120 332.024 -3.295 .013
FDI 368.958 98.553 .817 3.744 .007
Wanbury Ltd. 1 (Constant) 158665.165 413159.217 .384 .727
FDI -52398.653 136596.424
-.216 -.384 .727
Wyeth Ltd 1 (Constant) 232.976 148.397 1.570 .155
FDI 8.555 13.385 .220 .639 .541
274
7.1.2 Impact of FDI on PBIT:
The regression analysis run to assess the impact of FDI on sales of FDI-
based companies reveal that FDI significantly influences the PBIT in the
case of following companies(see table 7.2a and 7.2b)
• Fulford (India) Ltd with an R square value of .515 and beta(t) value
of 2.914 with significance value of .019
• Glaxosmithkline Pharmaceuticals Ltd with an R square value of
.809 and beta(t) value of 5.825 with significance value of .000
• K D L Biotech Ltd with an R square value of .548 and beta(t) value
of 3.114 with significance value of .014
• Kerala Ayurveda Ltd with an R square value of .728 and beta(t)
value of 4.011 with significance value of .007
• Solvay Pharma India Ltd with an R square value of .557 and beta(t)
value of 2.968 with significance value of .021
275
Table: 7.2a FDI and PBIT Model Summary
Company Model R R Square Adjusted R Square
Std. Error of the Estimate
Abbott India 1 .006a .000 -.125 20.919036
Astrazeneca Pharma India Ltd 1 .592a .350 .269 32.106775
Aventis Pharma Ltd. 1 .287a .082 -.032 81.250253
Biocon Ltd. 1 .234a .055 -.182 127.447214
Fresenius Kabi Oncology Ltd 1 .466a .218 -.174 101.831590
Fulford (India) Ltd 1 .718a .515 .454 9.671231
Glaxosmithkline Pharmaceuticals Ltd. 1 .900a .809 .785 136.167613
Kerala Ayurveda Ltd. 1 .853a .728 .683 6.563368
K D L Biotech Ltd. 1 .740a .548 .491 1.323414
Matrix Laboratories Ltd. 1 .252a .063 -.249 234.864511
Merck Ltd. 1 .037a .001 -.123 35.515218
Novartis India Ltd. 1 .475a .225 .128 32.193362
Pfizer Ltd. 1 .273a .075 -.041 148.620377
Solvay Pharma India Ltd. 1 .746a .557 .494 12.337396
Wanbury Ltd. 1 .140a .020 -.307 32.506452
Wyeth Ltd 1 .558a .312 .226 29.204164
276
Table: 7.2b FDI and PBIT
Coefficients
Company Model Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
Abbott India 1 (Constant) 98.576 141.031 .699 .504
FDI -.242 14.953 -.006 -.016 .987
Astrazeneca Pharma India Ltd
1 (Constant) -62.605 58.622 -1.068 .317
FDI 28.830 13.892 .592 2.075 .072
Aventis Pharma Ltd. 1 (Constant) -180.744 426.248 -.424 .683
FDI 30.635 36.129 .287 .848 .421
Biocon Ltd. 1 (Constant) 306.978 165.860 1.851 .138
FDI -5.400 11.236 -.234 -.481 .656
Fresenius Kabi Oncology Ltd
1 (Constant) 99.320 72.030 1.379 .302
FDI -5.336 7.154 -.466 -.746 .534
Fulford (India) Ltd 1 (Constant) -20.319 12.901 -1.575 .154
FDI 22.867 7.848 .718 2.914 .019
Glaxosmithkline Pharmaceuticals Ltd.
1 (Constant) -1856.441 405.018 -4.584 .002
FDI 59.071 10.142 .900 5.825 .000
Kerala Ayurveda Ltd. 1 (Constant) 77.808 19.064 4.081 .006
FDI -14.732 3.673 -.853 -4.011 .007
K D L Biotech Ltd. 1 (Constant) .942 .621 1.517 .168
FDI -.449 .144 -.740 -3.114 .014
Matrix Laboratories Ltd. 1 (Constant) 279.787 374.362 .747 .509
FDI -8.893 19.746 -.252 -.450 .683
Merck Ltd. 1 (Constant) -166720.240 1609503.721 -.104 .920
FDI 19400.000 187181.632 .037 .104 .920
Novartis India Ltd. 1 (Constant) 22.386 71.947 .311 .764
FDI 12.710 8.333 .475 1.525 .166
Pfizer Ltd. 1 (Constant) 32.662 182.928 .179 .863
FDI 11.678 14.552 .273 .803 .445
Solvay Pharma India Ltd.
1 (Constant) -302.119 112.449 -2.687 .031
FDI 99.072 33.378 .746 2.968 .021
Wanbury Ltd. 1 (Constant) 26548.655 108290.036 .245 .822
FDI -8771.279 35802.255 -.140 -.245 .822
Wyeth Ltd 1 (Constant) -140.956 117.373 -1.201 .264
FDI 20.153 10.587 .558 1.904 .093
277
7.1.3 Impact of FDI on Capital Employed:
The regression analysis run to assess the impact of FDI on sales of FDI-
based companies reveal that FDI significantly influences the Capital
Employed in the case of following companies(see table 7.3a and 7.3b)
• Fulford (India) Ltd with an R square value of .952 and beta(t) value
of 12.543 with significance value of .000
• Glaxosmithkline Pharmaceuticals Ltd with an R square value of
.665 and beta(t) value of 3.982 with significance value of .004
• K D L Biotech Ltd with an R square value of .904 and beta(t) value
of 8.699 with significance value of .000
• Kerala Ayurveda Ltd. with an R square value of .515 and beta(t)
value of 2.525 with significance value of .045
• Novartis India Ltd. with an R square value of .419 and beta(t)
value of 2.400 with significance value of .043
• Pfizer Ltd. with an R square value of .627 and beta(t) value of 3.670
with significance value of .006
• Solvay Pharma India Ltd. with an R square value of .739and
beta(t) value of 4.451 with significance value of .003
• Wyeth Ltd with an R square value of .623 and beta(t) value of
3.639 with significance value of .007
278
Table: 7.3a FDI and Capital Employed
Model Summary
Company Model R R Square
Adjusted R Square
Std. Error of the Estimate
Abbott India 1 .545a .297 .209 49.156125
Astrazeneca Pharma India Ltd 1 .613a .375 .297 33.790051
Aventis Pharma Ltd. 1 .590a .348 .267 216.614161
Biocon Ltd. 1 .706a .499 .373 307.972831
Fresenius Kabi Oncology Ltd 1 .738a .545 .318 85.747052
Fulford (India) Ltd 1 .976a .952 .946 11.460466
Glaxosmithkline Pharmaceuticals Ltd. 1 .815a .665 .623 280.821732
Kerala Ayurveda Ltd. 1 .718a .515 .434 27.885490
K D L Biotech Ltd. 1 .951a .904 .892 5.319659
Matrix Laboratories Ltd. 1 .594a .352 .137 152.081191
Merck Ltd. 1 .465a .216 .118 124.466732
Novartis India Ltd. 1 .647a .419 .346 105.399344
Pfizer Ltd. 1 .792a .627 .581 196.775453
Solvay Pharma India Ltd. 1 .860a .739 .702 20.775410
Wanbury Ltd. 1 .304a .092 -.210 156.672159
Wyeth Ltd 1 .790a .623 .576 26.766760
279
Table: 7.3b FDI and Capital Employed
Coefficients
Company Model Unstandardized
Coefficients Standardized Coefficients t Sig.
B Std. Error Beta
Abbott India 1 (Constant) -415.750 331.398 -1.255 .245
FDI 64.605 35.138 .545 1.839 .103
Astrazeneca Pharma India Ltd
1 (Constant) -17.827 61.696 -.289 .780
FDI 32.059 14.620 .613 2.193 .060
Aventis Pharma Ltd. 1 (Constant) -1849.249 1136.384 -1.627 .142
FDI 199.054 96.319 .590 2.067 .073
Biocon Ltd. 1 (Constant) 472.404 400.796 1.179 .304
FDI 54.152 27.153 .706 1.994 .117
Fresenius Kabi Oncology Ltd
1 (Constant) 464.891 60.652 7.665 .017
FDI 9.330 6.024 .738 1.549 .262
Fulford (India) Ltd 1 (Constant) -124.175 15.288 -8.123 .000
FDI 116.651 9.300 .976 12.543 .000
Glaxosmithkline Pharmaceuticals Ltd.
1 (Constant) -2308.420 835.278 -2.764 .025
FDI 83.295 20.915 .815 3.982 .004
Kerala Ayurveda Ltd. 1 (Constant) 286.735 80.996 3.540 .012
FDI -39.399 15.606 -.718 -2.525 .045
K D L Biotech Ltd. 1 (Constant) 9.991 2.496 4.004 .004
FDI 5.041 .579 .951 8.699 .000
Matrix Laboratories Ltd. 1 (Constant) 554.906 242.410 2.289 .106
FDI 16.336 12.786 .594 1.278 .291
Merck Ltd. 1 (Constant) -8382407.288 5640671.289 -1.486 .176
FDI 974888.889 655997.275 .465 1.486 .176
Novartis India Ltd. 1 (Constant) -206.098 235.550 -.875 .407
FDI 65.478 27.282 .647 2.400 .043
Pfizer Ltd. 1 (Constant) -421.253 242.199 -1.739 .120
FDI 70.705 19.267 .792 3.670 .006
Solvay Pharma India Ltd.
1 (Constant) -774.601 189.357 -4.091 .005
FDI 250.185 56.206 .860 4.451 .003
Wanbury Ltd. 1 (Constant) 288662.297 521928.190 .553 .619
FDI -95368.343 172557.022 -.304 -.553 .619
Wyeth Ltd 1 (Constant) -151.837 107.577 -1.411 .196
FDI 35.313 9.703 .790 3.639 .007
280
7.2 IMPACT OF FDI (QUANTUM) ON SELECT FINANCIAL VARIABLES:
AN ANALYSIS BASED ON AGGREGATE PARAMETERS
In case of aggregate analysis, FDI (amount in Rupees crores) of 18
companies is considered as independent variable and selected three (3)
financial variables (amount in Rupees crores) i.e. Sales, PBIT and Capital
Employed of these companies as dependent variables. The analysis
reveals that FDI significantly influences the following variables(see table
7.4a and 7.5b)
• Sales with an R square value of .712 and beta(t) value of 4.449
with significance value of .002
• Capital Employed with an R square value of .812 and beta(t) value
of 6.324 with significance value of .000
Table: 7.4a
FDI and the Indian Pharmaceutical sector Model Summary
Table: 7.4b FDI and the Indian Pharmaceutical sector
Coefficients Dependent
variable Model Unstandardized
Coefficients Standardized Coefficients t Sig.
B Std. Error Beta Sales
1 (Constant) 5297.950 1291.490 4.102 .003
FDI 31.053 6.980 .844 4.449 .002
PBIT 1 (Constant) 1436.468 746.068 1.925 .090
FDI 3.941 4.032 .327 .977 .357
Capital Employed
1 (Constant) -136.168 1537.252 -.089 .932
FDI 52.547 8.309 .913 6.324 .000
dependent variable Model R R Square
Adjusted R Square
Std. Error of the Estimate
Sales 1 .844a .712 .676 1738.622462
PBIT 1 .327a .107 -.005 1004.367016
Capital Employed 1 .913a .833 .812 2069.470102
281
Part II :
7.3 IMPACT OF FDI (FOREIGN PROMOTER QUOTA) ON THE FINANCIAL
PERFORMANCE OF SELECTED FDI-BASED PHARMACEUTICAL COMPANIES
– AN ANALYSIS BASED ON INDIVIDUAL PARAMETERS.
In this case, FDI (as percentage of foreign promoter in the share
holding pattern of the company) is considered as independent variable
and financial ratios measured as dependent variables. 18 FDI based
companies have been considered for the purpose of analysis. For each
company FDI (% of foreign promoter) is considered as independent
variable and selected 18 financial ratios are considered as dependent
variables.
7.3.1 Impact of FDI on Profitability
7.3.1.1 FDI and Net Profit Margin: The regression analysis run to
assess the impact of FDI on NPM of FDI-based companies reveal that
FDI significantly influences the NPM in the case of following
companies(see table 7.5a and 7.5b)
• Kerala Ayurveda Ltd which have an R square value of .503 and
beta(t) value of 2.848 with significance value of .022 .
282
Table: 7.5a
FDI and NPM
Model Summary
.127a .016 -.107 6.552892
.580a .337 .254 4.020174
.555a .308 .221 6.579950
.180a .032 -.089 10.077704
.376a .141 -.031 25.990277
.578a .334 .251 6.967634
.589a .347 .265 12.216325
.317a .101 -.049 16.356319
.709a .503 .441 8.393741
.343a .118 .007 16.135614
.167a .028 -.094 9.020731
.246a .061 -.057 4.061180
.036a .001 -.124 17.820628
.452a .205 .105 17.954322
.595a .354 .273 3.269144
.262a .069 -.048 4.583670
.215a .046 -.090 10.046627
.586a .343 .261 6.967376
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
283
Table: 7.5b
FDI and NPM
Coefficients a
8.646 34.377 .252 .808
.243 .671 .127 .363 .726
50.997 15.917 3.204 .013
-.512 .254 -.580 -2.016 .079
-.900 12.014 -.075 .942
.268 .142 .555 1.885 .096
22.840 5.016 4.553 .002
.157 .304 .180 .516 .620
21.359 11.623 1.838 .126
-.219 .242 -.376 -.907 .406
-21.049 15.510 -1.357 .212
.680 .339 .578 2.005 .080
-412.891 214.999 -1.920 .091
8.865 4.299 .589 2.062 .073
-35.233 38.068 -.926 .390
1.093 1.335 .317 .819 .444
7.790 4.157 1.874 .098
-.278 .098 -.709 -2.848 .022
20.934 6.959 3.008 .017
-.165 .160 -.343 -1.033 .332
315.015 607.136 .519 .618
-5.705 11.886 -.167 -.480 .644
17.385 9.076 1.915 .092
.121 .168 .246 .718 .493
21.628 27.622 .783 .456
.063 .621 .036 .101 .922
17.450 6.348 2.749 .025
-.319 .222 -.452 -1.434 .189
9.860 1.887 5.224 .001
.175 .083 .595 2.094 .070
16.512 4.556 3.624 .007
.055 .072 .262 .769 .464
14.677 4.936 2.973 .021
-.158 .271 -.215 -.582 .579
-642.194 326.275 -1.968 .085
13.100 6.411 .586 2.044 .075
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Net Profit Margina.
284
7.3.1.2 FDI and ROTA: The regression analysis run to assess the
impact of FDI on ROTA of FDI-based companies reveal that FDI
significantly influences the ROTA in the case of following companies(see
table 7.6a and 7.6b)
• Abbott India Ltd which have an R square value of .540 and beta(t)
value of .870 with significance value of .410 .
• Glaxosmithkline laboratories ltd which have an R square value of
.454 and beta(t) value of 2.579with significance value of .033
• Ranbaxy Laboratories Ltd. which have an R square value of .433
and beta(t) value of 2.472 with significance value of .039
• Solvay Pharma India Ltd. which have an R square value of 2.936
and beta(t) value of .519 with significance value of .019
Table: 7.6a
FDI and ROTA
Model Summary
.294a .086 -.028 4.727250
.735a .540 .482 4.198897
.578a .334 .251 6.234498
.001a .000 -.125 5.567351
.508a .258 .110 7.937519
.074a .005 -.119 14.730526
.674a .454 .386 3.395048
.161a .026 -.096 6.996072
.287a .082 -.033 4.062439
.553a .306 .219 10.249607
.423a .179 .077 5.085493
.192a .037 -.084 5.406481
.393a .155 .049 5.539453
.658a .433 .362 6.503065
.211a .045 -.075 1.169772
.720a .519 .459 5.052145
.158a .025 -.114 5.665396
.532a .283 .194 4.291151
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
285
Table: 7.6b
FDI and ROTA
Coefficients a
38.322 24.800 1.545 .161
-.421 .484 -.294 -.870 .410
73.035 16.625 4.393 .002
-.813 .266 -.735 -3.062 .016
-5.894 11.383 -.518 .619
.270 .135 .578 2.004 .080
13.855 2.771 5.000 .001
-.001 .168 -.001 -.003 .998
8.160 3.550 2.299 .070
-.097 .074 -.508 -1.320 .244
2.463 32.789 .075 .942
.151 .717 .074 .210 .839
-141.252 59.750 -2.364 .046
3.081 1.195 .674 2.579 .033
-1.340 6.365 -.210 .839
-.106 .230 -.161 -.462 .657
-2.277 2.012 -1.132 .290
-.040 .047 -.287 -.846 .422
14.828 4.421 3.354 .010
-.191 .102 -.553 -1.879 .097
470.112 342.277 1.373 .207
-8.855 6.701 -.423 -1.321 .223
24.543 12.083 2.031 .077
-.123 .224 -.192 -.552 .596
23.369 8.586 2.722 .026
-.233 .193 -.393 -1.209 .261
10.821 2.299 4.707 .002
-.199 .080 -.658 -2.472 .039
4.997 .675 7.399 .000
-.018 .030 -.211 -.612 .557
37.667 5.022 7.500 .000
-.233 .079 -.720 -2.936 .019
1.298 2.783 .466 .655
.064 .153 .158 .422 .686
-339.508 200.950 -1.690 .130
7.024 3.948 .532 1.779 .113
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: ROTAa.
286
7.3.1.3 FDI and RONW : The regression analysis run to assess the
impact of FDI on RONW of FDI-based companies reveal that FDI
significantly influences RONW in the case of following companies(see
table 7.7a and 7.7b)
• Abbott India Ltd. which have an R square value of .472 and beta(t)
value of 3.693 with significance value of .006
• Matrix Laboratories Ltd. which have an R square value of .430 and
beta(t) value of 2.457 with significance value of .039
• Ranbaxy Laboratories Ltd. which have an R square value of .603 and
beta(t) value of 3.483 with significance value of .008
• Solvay Pharma India Ltd. which have an R square value of .938 and
beta(t) value of 10.992 with significance value of .000
Table: 7.7a FDI and RONW
Model Summary
.373a .139 .031 7.068159
.687a .472 .406 9.412998
.541a .292 .204 13.576463
.262a .069 -.048 11.575245
.292a .085 -.098 12.642371
.081a .007 -.118 42.975636
.515a .265 .173 12.054439
.109a .012 -.153 47.494455
.407a .165 .061 14.021806
.656a .430 .359 35.484449
.416a .173 .070 6.993741
.126a .016 -.107 3.227240
.140a .020 -.103 8.800190
.776a .603 .553 13.347274
.232a .054 -.064 1.534111
.968a .938 .930 6.518724
.010a .000 -.143 19.432309
.401a .161 .056 9.796292
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
287
Table: 7.7b
FDI and RONW
Coefficients a
66.235 37.080 1.786 .112
-.822 .724 -.373 -1.135 .289
137.621 37.269 3.693 .006
-1.593 .595 -.687 -2.676 .028
-14.647 24.789 -.591 .571
.534 .294 .541 1.818 .107
23.615 5.762 4.099 .003
-.269 .350 -.262 -.769 .464
5.532 5.654 .978 .373
-.080 .118 -.292 -.682 .525
-9.004 95.661 -.094 .927
.482 2.092 .081 .230 .824
-335.840 212.150 -1.583 .152
7.201 4.242 .515 1.697 .128
-6.549 110.541 -.059 .955
-1.043 3.876 -.109 -.269 .797
-8.570 6.945 -1.234 .252
-.205 .163 -.407 -1.259 .244
60.322 15.304 3.942 .004
-.864 .352 -.656 -2.457 .039
631.733 470.711 1.342 .216
-11.924 9.215 -.416 -1.294 .232
17.412 7.212 2.414 .042
.048 .133 .126 .360 .728
22.353 13.640 1.639 .140
-.123 .306 -.140 -.400 .700
19.363 4.719 4.103 .003
-.575 .165 -.776 -3.483 .008
6.720 .886 7.587 .000
-.026 .039 -.232 -.675 .519
108.147 6.480 16.690 .000
-1.125 .102 -.968 -10.992 .000
5.662 9.547 .593 .572
-.013 .524 -.010 -.026 .980
-543.744 458.750 -1.185 .270
11.170 9.013 .401 1.239 .250
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: RONWa.
288
7.3.1.4 FDI and ROCE: The regression analysis run to assess the
impact of FDI on ROCE of FDI-based companies reveal that FDI
significantly influences the ROCE in the case of following companies(see
table 7.8a and 7.8b)
• Abbott India Ltd. which have an R square value of .458 and
beta(t) value of 2.601 with significance value of .032
• Ranbaxy Laboratories Ltd. which have an R square value of .534
and beta(t) value of 3.26 with significance value of .016
• Solvay Pharma India Ltd. which have an R square value of .937
and beta(t) value of 10.903with significance value of .000
Table: 7.8a FDI and ROCE
Model Summary
.375a .140 .033 7.271613
.677a .458 .390 9.275445
.564a .318 .233 11.279134
.139a .019 -.103 9.858579
.360a .130 -.044 10.146101
.099a .010 -.114 26.624947
.509a .259 .166 12.064707
.120a .014 -.150 23.773991
.348a .121 .011 5.365678
.633a .400 .325 21.658384
.427a .182 .080 6.905815
.187a .035 -.086 3.480782
.188a .035 -.085 8.674409
.731a .534 .475 11.472665
.239a .057 -.061 1.562437
.968a .937 .929 6.576046
.327a .107 -.021 10.671831
.392a .154 .048 9.726096
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
289
Table: 7.8a
FDI and ROCE
Coefficients a
68.297 38.148 1.790 .111
-.852 .745 -.375 -1.144 .286
132.927 36.724 3.620 .007
-1.525 .586 -.677 -2.601 .032
-11.263 20.594 -.547 .599
.471 .244 .564 1.931 .090
18.814 4.907 3.834 .005
-.118 .298 -.139 -.396 .703
5.350 4.537 1.179 .291
-.081 .094 -.360 -.863 .427
-2.731 59.265 -.046 .964
.364 1.296 .099 .281 .786
-330.951 212.330 -1.559 .158
7.101 4.246 .509 1.672 .133
-2.204 55.333 -.040 .970
-.574 1.940 -.120 -.296 .777
-3.392 2.658 -1.277 .238
-.065 .062 -.348 -1.049 .325
35.872 9.341 3.840 .005
-.496 .215 -.633 -2.310 .050
643.820 464.793 1.385 .203
-12.157 9.099 -.427 -1.336 .218
15.162 7.779 1.949 .087
.077 .144 .187 .537 .606
25.219 13.445 1.876 .098
-.164 .302 -.188 -.542 .603
18.032 4.056 4.445 .002
-.429 .142 -.731 -3.026 .016
6.750 .902 7.483 .000
-.028 .040 -.239 -.697 .506
108.135 6.537 16.543 .000
-1.126 .103 -.968 -10.903 .000
3.019 5.243 .576 .583
.263 .288 .327 .915 .391
-524.081 455.463 -1.151 .283
10.780 8.949 .392 1.205 .263
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: ROCEa.
290
7.3.2 Impact of FDI on Liquidity
7.3.2.1 FDI and Current Ratio: The regression analysis run to
assess the impact of FDI on Current Ratio of FDI-based companies
reveal that FDI significantly influences the Current ratio in the case of
following companies(see table 7.9a and 7.9b)
• Abbott India Ltd. which have an R square value of .513 and beta(t)
value of 2.901 with significance value of .020
• Astrazeneca Pharma India Ltd. which have an R square value of
.531 and beta(t) value of 3.012 with significance value of .017
• Merck Ltd. which have an R square value of .657and beta(t) value
of 3.912 with significance value of .004
• Sandu Pharmaceuticals Ltd. which have an R square value of .419
and beta(t) value of 2.400 with significance value of .043
Table: 7.9a FDI and Current Ratio
Model Summary
.396a .157 .052 .848469
.716a .513 .452 .455419
.729a .531 .473 .443505
.010a .000 -.125 .782703
.104a .011 -.187 .784542
.609a .371 .292 .956178
.132a .017 -.105 .388121
.034a .001 -.165 .320232
.545a .298 .210 .977964
.583a .340 .258 .170959
.810a .657 .614 .606770
.493a .243 .148 .194704
.433a .188 .086 .394960
.523a .274 .183 .407828
.647a .419 .346 .537635
.086a .007 -.117 .727612
.632a .400 .314 .440569
.606a .368 .289 .347179
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
291
Table: 7.9b
FDI and Current Ratio
Coefficientsa
-2.771 4.451 -.622 .551
.106 .087 .396 1.220 .257
-3.991 1.803 -2.213 .058
.084 .029 .716 2.901 .020
4.916 .810 6.071 .000
-.029 .010 -.729 -3.012 .017
2.022 .390 5.191 .001
.001 .024 .010 .028 .978
1.552 .351 4.423 .007
.002 .007 .104 .233 .825
-2.077 2.128 -.976 .358
.101 .047 .609 2.171 .062
3.845 6.831 .563 .589
-.051 .137 -.132 -.376 .717
.723 .745 .970 .369
.002 .026 .034 .082 .937
1.219 .484 2.516 .036
.021 .011 .545 1.841 .103
1.338 .074 18.144 .000
-.003 .002 -.583 -2.032 .077
-157.169 40.838 -3.849 .005
3.128 .799 .810 3.912 .004
2.376 .435 5.461 .001
-.013 .008 -.493 -1.603 .148
2.856 .612 4.665 .002
-.019 .014 -.433 -1.360 .211
1.520 .144 10.542 .000
-.009 .005 -.523 -1.737 .121
2.913 .310 9.386 .000
-.033 .014 -.647 -2.400 .043
2.723 .723 3.765 .006
-.003 .011 -.086 -.245 .812
1.855 .216 8.572 .000
-.026 .012 -.632 -2.158 .068
37.996 16.258 2.337 .048
-.689 .319 -.606 -2.157 .063
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Current ratioa.
292
7.3.2.2 FDI and Quick Ratio : The regression analysis run to
assess the impact of FDI on Quick Ratio of FDI-based companies reveal
that FDI significantly influences the Quick ratio in the case of following
companies(see table 7.10a and 7.10b)
• Abbott India Ltd. which have an R square value of .533 and beta(t)
value of 3.021 with significance value of .017
• Fulford (India) Ltd. which have an R square value of .420 and
beta(t) value of 2.409 with significance value of .043
• Merck Ltd. which have an R square value of .627 and beta(t) value
of 3.669 with significance value of .006
• Sandu Pharmaceuticals Ltd. which have an R square value of .523
and beta(t) value of 2.959with significance value of .018
• Wyeth Ltd which have an R square value of .413 and beta(t) value
of 2.373 with significance value of .045
293
Table: 7.10a FDI and Quick Ratio
Model Summary
.347a .121 .011 .698053
.730a .533 .474 .311582
.551a .303 .216 .501445
.129a .017 -.106 .719691
.082a .007 -.192 .426221
.648a .420 .348 .881609
.076a .006 -.118 .328243
.068a .005 -.161 .183239
.372a .139 .031 .486281
.055a .003 -.122 .153396
.792a .627 .581 .635468
.158a .025 -.097 .194698
.452a .204 .105 .507471
.320a .102 -.010 .235040
.723a .523 .463 .215011
.082a .007 -.117 .713901
.339a .115 -.011 .238324
.643a .413 .340 .231735
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
Table: 7.10b
FDI and Quick Ratio
Coefficients a
-2.098 3.662 -.573 .582
.075 .071 .347 1.047 .326
-3.130 1.234 -2.537 .035
.060 .020 .730 3.021 .017
3.423 .916 3.738 .006
-.020 .011 -.551 -1.866 .099
1.402 .358 3.913 .004
-.008 .022 -.129 -.368 .722
.646 .191 3.389 .019
-.001 .004 -.082 -.185 .860
-3.279 1.962 -1.671 .133
.103 .043 .648 2.409 .043
1.621 5.777 .281 .786
-.025 .116 -.076 -.217 .834
.364 .426 .855 .426
.003 .015 .068 .167 .873
.370 .241 1.535 .163
.006 .006 .372 1.135 .289
.514 .066 7.769 .000
.000 .002 -.055 -.155 .881
-155.191 42.770 -3.629 .007
3.072 .837 .792 3.669 .006
1.199 .435 2.756 .025
-.004 .008 -.158 -.453 .663
2.339 .787 2.974 .018
-.025 .018 -.452 -1.434 .190
.737 .083 8.875 .000
-.003 .003 -.320 -.955 .367
1.683 .124 13.560 .000
-.016 .005 -.723 -2.959 .018
1.782 .710 2.511 .036
-.003 .011 -.082 -.233 .822
.984 .117 8.407 .000
-.006 .006 -.339 -.955 .372
-23.935 10.852 -2.206 .058
.506 .213 .643 2.373 .045
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Quick ratioa.
294
7.3.3 Impact of FDI on Long-term Solvency
7.3.3.1 FDI and Debt-Equity Ratio : The regression analysis
run to assess the impact of FDI on D/E Ratio of FDI-based companies
reveal that FDI significantly influences the D/E ratio in the case of
following companies(see table 7.11a and 7.11b)
• Astrazeneca Pharma India Ltd. which have an R square value of
.888 and beta(t) value of 7.954 with significance value of .000
• Biocon Ltd. which have an R square value of .602 and beta(t) value
of 3.477 with significance value of .008
• Fresenius Kabi Oncology Ltd. which have an R square value of .582
and beta(t) value of 2.639 with significance value of .046
• Sandu Pharmaceuticals Ltd. which have an R square value of .432
and beta(t) value of 2.467 with significance value of .039
295
Table: 7.11a
FDI and Debt-Equity Ratio
Model Summary
.191a .036 -.084 .133009
.942a .888 .874 .004369
.157a .025 -.097 .178880
.776a .602 .552 .176431
.763a .582 .498 .140428
.590a .348 .267 .635068
.305a .093 -.020 .028488
.442a .195 .061 3.426238
.325a .106 -.006 1.195475
.580a .336 .253 .403622
.111a .012 -.111 .010000
.115a .013 -.110 .182677
.131a .017 -.106 .013301
.411a .169 .065 .553895
.657a .432 .361 .019579
.072a .005 -.119 .033248
.528a .279 .176 .884033
.509a .259 .167 .002887
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
296
Table: 7.11b
FDI and Debt-Equity Ratio
Coefficients a
.452 .698 .648 .535
-.007 .014 -.191 -.550 .597
.149 .017 8.622 .000
-.002 .000 -.942 -7.954 .000
-.090 .327 -.277 .789
.002 .004 .157 .449 .665
.512 .088 5.828 .000
-.019 .005 -.776 -3.477 .008
.260 .063 4.140 .009
.003 .001 .763 2.639 .046
3.405 1.414 2.409 .043
-.064 .031 -.590 -2.067 .073
-.443 .501 -.883 .403
.009 .010 .305 .907 .391
-6.961 7.974 -.873 .416
.337 .280 .442 1.206 .273
2.177 .592 3.677 .006
.014 .014 .325 .972 .360
.947 .174 5.441 .001
-.008 .004 -.580 -2.012 .079
.216 .673 .321 .757
-.004 .013 -.111 -.316 .760
.211 .408 .516 .620
-.002 .008 -.115 -.328 .751
.012 .021 .560 .591
.000 .000 -.131 -.374 .718
.436 .196 2.228 .057
.009 .007 .411 1.276 .238
.177 .011 15.629 .000
.001 .000 .657 2.467 .039
.005 .033 .139 .893
.000 .001 .072 .205 .843
2.644 .434 6.088 .000
-.039 .024 -.528 -1.646 .144
.237 .135 1.755 .117
-.004 .003 -.509 -1.673 .133
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Debt equity ratioa.
297
7.3.3.2 FDI and Proprietory Ratio : The regression analysis run
to assess the impact of FDI on Proprietary Ratio of FDI-based companies
reveal that FDI significantly influences the proprietary ratio in the case of
following companies(see table 7.12a and 7.12b)
• Abbott India Ltd. which have an R square value of .452 and beta(t)
value of 2.566 with significance value of .033
• Biocon Ltd. which have an R square value of .564 and beta(t) value
of 3.214 with significance value of .012
• Fulford (India) Ltd. which have an R square value of .455 and
beta(t) value of 2.586 with significance value of .032
• Wyeth Ltd which have an R square value of .418 and beta(t) value
of 2.395with significance value of .044
298
Table: 7.12a
FDI and Proprietary Ratio
Model Summary
.344a .118 .008 .080874
.672a .452 .383 .067547
.545a .297 .209 .112695
.751a .564 .509 .089531
.745a .555 .466 .084300
.675a .455 .387 .179985
.153a .023 -.099 .130928
.318a .101 -.049 .145125
.088a .008 -.116 .096464
.608a .370 .291 .111057
.307a .094 -.019 .061495
.292a .085 -.029 .109424
.293a .086 -.028 .111757
.594a .352 .271 .134796
.286a .082 -.033 .015209
.129a .017 -.106 .076599
.289a .084 -.047 .146548
.646a .418 .345 .042806
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
299
Table: 7.12b
FDI and Proprietary Ratio
Coefficients a
.245 .424 .579 .579
.009 .008 .344 1.036 .330
-.087 .267 -.324 .754
.011 .004 .672 2.566 .033
.977 .206 4.748 .001
-.004 .002 -.545 -1.838 .103
.525 .045 11.788 .000
.009 .003 .751 3.214 .012
.707 .038 18.752 .000
-.002 .001 -.745 -2.499 .055
-.518 .401 -1.292 .232
.023 .009 .675 2.586 .032
1.456 2.304 .632 .545
-.020 .046 -.153 -.436 .674
.574 .338 1.699 .140
-.010 .012 -.318 -.822 .442
.289 .048 6.044 .000
.000 .001 -.088 -.250 .809
.370 .048 7.730 .000
.002 .001 .608 2.168 .062
-3.016 4.139 -.729 .487
.074 .081 .307 .913 .388
.475 .245 1.942 .088
.004 .005 .292 .863 .413
.709 .173 4.090 .003
-.003 .004 -.293 -.868 .411
.540 .048 11.336 .000
-.003 .002 -.594 -2.086 .070
.776 .009 88.407 .000
.000 .000 -.286 -.843 .424
.666 .076 8.746 .000
.000 .001 .129 .367 .723
.315 .072 4.371 .003
.003 .004 .289 .799 .450
5.501 2.005 2.744 .025
-.094 .039 -.646 -2.395 .044
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: ProprietoryRatioa.
300
7.3.4 Impact of FDI on Efficiency
7.3.4.1 FDI and Stock Turnover Ratio: The regression analysis
run to assess the impact of FDI on Stock turnover ratio(STR) of FDI-
based companies reveal that FDI significantly influences the STR in the
case of following companies(see table 7.13a and 7.13b)
• Fresenius Kabi Oncology Ltd. which have an R square value of .711
and beta(t) value of 3.510 with significance value of .017
• Kerala Ayurveda Ltd. which have an R square value of .732 and
beta(t) value of 4.674 with significance value of .002
• Novartis India Ltd. which have an R square value of .407 and
beta(t) value of 2.344 with significance value of .047
• Solvay Pharma India Ltd. which have an R square value of .531
and beta(t) value of 3.011 with significance value of .017
• Wanbury Ltd. which have an R square value of .774 and beta(t)
value of 4.899 with significance value of .002
• Wyeth Ltd which have an R square value of .680 and beta(t) value
of 4.122 with significance value of .003
301
Table: 7.13a
FDI and Stock Turnover Ratio
Model Summary
.578a .334 .251 1.280026
.089a .008 -.116 3.217827
.225a .051 -.068 3.524746
.121a .015 -.108 1.478036
.843a .711 .654 .783293
.048a .002 -.122 2.063352
.552a .304 .217 .869276
.192a .037 -.124 2.921728
.856a .732 .698 .467504
.450a .202 .103 .779284
.012a .000 -.125 2.153392
.638a .407 .333 1.656697
.010a .000 -.125 .944438
.484a .234 .138 .635869
.458a .210 .111 .438299
.729a .531 .473 1.999365
.880a .774 .742 1.537892
.825a .680 .640 1.043685
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
302
Table: 7.13b
FDI and Stock Turnover Ratio Coefficients a
20.396 6.715 3.037 .016
-.263 .131 -.578 -2.003 .080
6.247 12.740 .490 .637
.052 .203 .089 .254 .806
4.000 6.436 .621 .552
.050 .076 .225 .652 .532
6.046 .736 8.218 .000
.015 .045 .121 .346 .738
4.472 .350 12.765 .000
-.026 .007 -.843 -3.510 .017
5.951 4.593 1.296 .231
.014 .100 .048 .135 .896
-21.717 15.299 -1.420 .194
.572 .306 .552 1.870 .098
10.107 6.800 1.486 .188
-.114 .238 -.192 -.479 .649
3.659 .232 15.803 .000
-.025 .005 -.856 -4.674 .002
4.387 .336 13.052 .000
-.011 .008 -.450 -1.424 .192
13.308 144.933 .092 .929
-.093 2.837 -.012 -.033 .975
.713 3.702 .193 .852
.161 .069 .638 2.344 .047
7.612 1.464 5.200 .001
-.001 .033 -.010 -.030 .977
4.334 .225 19.280 .000
-.012 .008 -.484 -1.563 .157
5.888 .253 23.266 .000
-.016 .011 -.458 -1.459 .183
13.670 1.987 6.878 .000
-.095 .031 -.729 -3.011 .017
4.624 .756 6.120 .000
.203 .041 .880 4.899 .002
-195.301 48.875 -3.996 .004
3.958 .960 .825 4.122 .003
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Stock Turnover Ratioa.
303
7.3.4.2 FDI and Inventory Ratio: The regression analysis run to
assess the impact of FDI on Inventory Ratio of FDI-based companies
reveal that FDI significantly influences the Inventory ratio in the case of
following companies (see table 7.14a and 7.14b)
• Abbott India Ltd. which have an R square value of .714 and beta(t)
value of 4.467 with significance value of .002
• Fulford (India) Ltd. which have an R square value of .839 and
beta(t) value of 6.461 with significance value of .000
• Ranbaxy Laboratories Ltd. which have an R square value of .553
and beta(t) value of 3.148 with significance value of .014
• Sandu Pharmaceuticals Ltd. which have an R square value of .421
and beta(t) value of 2.412 with significance value of .042
• Wanbury Ltd. which have an R square value of .793 and beta(t)
value of 5.178 with significance value of .001
• Wyeth Ltd which have an R square value of .889 and beta(t) value
of 7.985 with significance value of .000
FDI significantly influencing the inventory ratio means that there is a
itive relationship between FDI and inventory ratio and increase in level
of FDI will increase the level of inventory.
304
Table: 7.14a
FDI and Inventory Ratio
Model Summary
.222a .049 -.070 .089020
.845a .714 .678 .067727
.174a .030 -.091 .139525
.292a .086 -.029 .062596
.304a .092 -.089 .070863
.916a .839 .819 .081684
.165a .027 -.095 .163372
.093a .009 -.157 .143596
.209a .044 -.076 .060097
.617a .380 .303 .092617
.427a .182 .080 .133202
.394a .155 .049 .056576
.462a .214 .115 .094346
.744a .553 .497 .036878
.649a .421 .349 .033683
.070a .005 -.119 .134355
.890a .793 .763 .045880
.943a .889 .875 .047665
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
305
Table: 7.14b
FDI and Inventory Ratio
Coefficients a
.588 .467 1.260 .243
-.006 .009 -.222 -.644 .538
1.665 .268 6.208 .000
-.019 .004 -.845 -4.467 .002
.368 .255 1.446 .186
-.002 .003 -.174 -.500 .630
.275 .031 8.820 .000
.002 .002 .292 .865 .412
.437 .032 13.786 .000
.000 .001 -.304 -.712 .508
1.554 .182 8.548 .000
-.026 .004 -.916 -6.461 .000
1.558 2.875 .542 .603
-.027 .057 -.165 -.472 .650
.243 .334 .728 .494
.003 .012 .093 .229 .826
.494 .030 16.604 .000
.000 .001 .209 .603 .563
.510 .040 12.764 .000
-.002 .001 -.617 -2.216 .058
12.264 8.965 1.368 .208
-.234 .176 -.427 -1.336 .218
.431 .126 3.406 .009
-.003 .002 -.394 -1.212 .260
.398 .146 2.724 .026
-.005 .003 -.462 -1.474 .179
.360 .013 27.594 .000
-.001 .000 -.744 -3.148 .014
.219 .019 11.256 .000
.002 .001 .649 2.412 .042
.329 .134 2.465 .039
.000 .002 .070 .200 .847
.321 .023 14.236 .000
-.006 .001 -.890 -5.178 .001
18.064 2.232 8.093 .000
-.350 .044 -.943 -7.985 .000
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Inventory Ratioa.
306
7.3.4.3 FDI and Assets Turnover Ratio : The regression analysis
run to assess the impact of FDI on Assets Turnover Ratio (ATR) of FDI-
based companies reveal that FDI significantly influences the assets
turnover ratio in the case of following companies(see table 7.15a and
7.15b)
• Biocon Ltd. which have an R square value of .603 and beta(t) value
of 3.485 with significance value of .008
• Fulford (India) Ltd. which have an R square value of .890 and
beta(t) value of 8.054 with significance value of .000
• Kerala Ayurveda Ltd. which have an R square value of .917 and
beta(t) value of 9.418 with significance value of .000
• Matrix Laboratories Ltd. which have an R square value of .526 and
beta(t) value of 2.978 with significance value of .018
• Ranbaxy Laboratories Ltd. which have an R square value of .413
and beta(t) value of 10.009 with significance value of .000
• Sandu Pharmaceuticals Ltd. which have an R square value of .417
and beta(t) value of 2.394 with significance value of .044
• Solvay Pharma India Ltd. which have an R square value of .812
and beta(t) value of 5.876 with significance value of .000
• Wyeth Ltd which have an R square value of .728 and beta(t) value
of 4.622 with significance value of .002
307
Table: 7.15a
FDI and Assets turnover Ratio
Model Summary
.565a .319 .234 .211652
.399a .159 .054 .124753
.259a .067 -.049 .241065
.776a .603 .553 .112274
.519a .270 .124 .201553
.944a .890 .876 .316384
.204a .042 -.078 .418562
.385a .148 .006 .208408
.958a .917 .907 .045294
.725a .526 .466 .297921
.293a .086 -.028 .379561
.557a .310 .224 .154909
.512a .262 .169 .434213
.643a .413 .340 .220238
.646a .417 .345 .100610
.901a .812 .788 .362158
.193a .037 -.100 .109176
.853a .728 .693 .111259
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
308
Table: 7.15b
FDI and Assets turnover Ratio
Coefficientsa
3.396 1.110 3.059 .016
-.042 .022 -.565 -1.938 .089
1.062 .494 2.149 .064
.010 .008 .399 1.232 .253
.924 .440 2.098 .069
.004 .005 .259 .760 .469
.842 .056 15.062 .000
-.012 .003 -.776 -3.485 .008
.639 .090 7.095 .001
-.003 .002 -.519 -1.359 .232
7.684 .704 10.911 .000
-.124 .015 -.944 -8.054 .000
5.113 7.366 .694 .507
-.087 .147 -.204 -.589 .572
.152 .485 .313 .765
.017 .017 .385 1.021 .347
.640 .022 28.546 .000
-.005 .001 -.958 -9.418 .000
1.174 .128 9.136 .000
-.009 .003 -.725 -2.978 .018
23.342 25.546 .914 .388
-.434 .500 -.293 -.868 .411
1.800 .346 5.198 .001
-.012 .006 -.557 -1.897 .094
2.163 .673 3.214 .012
-.025 .015 -.512 -1.684 .131
.779 .078 10.009 .000
-.006 .003 -.643 -2.375 .045
.727 .058 12.509 .000
-.006 .003 -.646 -2.394 .044
3.974 .360 11.040 .000
-.033 .006 -.901 -5.876 .000
.628 .054 11.711 .000
-.002 .003 -.193 -.521 .618
25.114 5.210 4.820 .001
-.473 .102 -.853 -4.622 .002
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Assets Turnover Ratioa.
309
7.3.5 Impact of FDI on Expenses
7.3.5.1 FDI and R& D Expenses Ratio: The regression analysis
run to assess the impact of FDI on R & D Expenses Ratio of FDI-based
companies reveal that FDI significantly influences the R&D Expenses in
the case of following companies(see table 7.16a and 7.16b)
• Astrazeneca Pharma India Ltd. which have an R square value of
.898 and beta(t) value of 8.372 with significance value of .000
• Aventis Pharma Ltd. which have an R square value of .825 and
beta(t) value of 6.133 with significance value of .000
• Matrix Laboratories Ltd. which have an R square value of .482 and
beta(t) value of 2.728 with significance value of .026
• Wanbury Ltd. which have an R square value of .518 and beta(t)
value of 2.744 with significance value of .029
• Wyeth Ltd which have an R square value of .819 and beta(t) value
of 6.021 with significance value of .000
310
Table: 7.16a
FDI R& D Expenses Ratio
Model Summary
.908a .825 .803 .001227
.286a .082 -.033 .001633
.947a .898 .885 .005186
.553a .306 .219 .013790
.096a .009 -.189 .014493
.402a .161 .057 .001213
.086a .007 -.117 .002180
.694a .482 .417 .043329
.347a .120 .010 .001535
.492a .242 .147 .000945
.064a .004 -.120 .003589
.141a .020 -.103 .050328
.720a .518 .449 .030327
.905a .819 .797 .000564
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.GlaxosmithklinePharmaceuticals Ltd.Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
311
Table: 7.16b
FDI and R& D Expenses Ratio
Coefficientsa
-.034 .006 -5.275 .001
.001 .000 .908 6.133 .000
-.001 .006 -.079 .939
8.73E-005 .000 .286 .845 .422
.095 .009 10.057 .000
-.001 .000 -.947 -8.372 .000
.042 .007 6.135 .000
.001 .000 .553 1.877 .097
.099 .006 15.240 .000
-2.9E-005 .000 -.096 -.215 .838
-.023 .021 -1.063 .319
.001 .000 .402 1.241 .250
.007 .001 6.259 .000
-6.2E-006 .000 -.086 -.243 .814
.036 .019 1.942 .088
.001 .000 .694 2.728 .026
-.106 .103 -1.021 .337
.002 .002 .347 1.046 .326
.005 .002 2.370 .045
-6.3E-005 .000 -.492 -1.599 .149
.032 .006 5.734 .000
2.25E-005 .000 .064 .180 .861
.096 .018 5.420 .001
.000 .001 .141 .402 .698
-.003 .015 -.219 .833
.002 .001 .720 2.744 .029
.162 .026 6.115 .000
-.003 .001 -.905 -6.021 .000
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
GlaxosmithklinePharmaceuticals Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: R&D Expenses Ratioa.
312
7.3.6 Impact of FDI on Growth
7.3.6.1 FDI and growth in Forex Earnings : The regression
analysis run to assess the impact of FDI on growth of Forex earnings of
FDI-based companies reveal that FDI significantly influences the growth
of Forex earnings in the case of following companies(see table 7.17a and
7.17b)
• Biocon Ltd. which have an R square value of .763 and beta(t) value
of 4.751 with significance value of .002
• Glaxosmithkline Pharmaceuticals Ltd. which have an R square
value of .720 and beta(t) value of 4.242 with significance value of
.004
• Merck Ltd. which have an R square value of .467 and beta(t) value
of 2.477 with significance value of .042
313
Table: 7.17a
FDI and growth in Forex Earnings
Model Summary
.004a .000 -.143 28.232363
.618a .382 .294 33.542441
.195a .038 -.100 1641.362586
.874a .763 .729 33.816566
.357a .127 -.091 31.515072
.221a .049 -.087 118.570907
.848a .720 .680 14.073270
.485a .235 .126 45.147586
.171a .029 -.109 116.652611
.362a .131 .007 928.815728
.683a .467 .391 25.969816
.241a .058 -.077 34.596983
.038a .001 -.141 75.162609
.208a .043 -.093 30.115143
.169a .028 -.110 41.187724
.510a .260 .154 344.142526
.260a .068 -.065 232.078742
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
314
Table: 7.17b
FDI and growth in Forex Earnings
Coefficients a
22.770 149.406 .152 .883
-.033 2.909 -.004 -.011 .991
-422.567 208.458 -2.027 .082
6.798 3.269 .618 2.080 .076
-1766.453 4473.962 -.395 .705
26.890 51.254 .195 .525 .616
123.907 19.407 6.384 .000
-5.308 1.117 -.874 -4.751 .002
24.388 15.758 1.548 .197
.232 .303 .357 .764 .487
-162.277 277.640 -.584 .577
3.593 5.995 .221 .599 .568
-1120.248 266.159 -4.209 .004
22.628 5.334 .848 4.242 .004
-98.515 41.357 -2.382 .049
2.181 1.486 .485 1.467 .186
-9.824 65.535 -.150 .885
.671 1.461 .171 .459 .660
677.749 444.015 1.526 .171
-9.954 9.677 -.362 -1.029 .338
-4339.711 1759.085 -2.467 .043
85.282 34.431 .683 2.477 .042
49.407 78.251 .631 .548
-.944 1.440 -.241 -.656 .533
27.653 118.760 .233 .823
-.268 2.641 -.038 -.102 .922
22.184 11.382 1.949 .092
-.213 .378 -.208 -.564 .591
-175.280 375.404 -.467 .655
2.546 5.627 .169 .452 .665
402.088 193.343 2.080 .076
-15.563 9.928 -.510 -1.568 .161
-8912.764 12641.892 -.705 .504
176.934 248.103 .260 .713 .499
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Forex earningsa.
315
7.3.6.2 FDI and growth in Sales : The regression analysis run
to assess the impact of FDI on growth in Sales of FDI-based companies
reveal that FDI significantly influences the growth in sales in the case of
following companies(see table 7.18a and 7.18b)
• Aventis Pharma Ltd. which have an R square value of .495 and
beta(t) value of 2.618 with significance value of .034
• Biocon Ltd. which have an R square value of .600 and beta(t) value
of 3.239 with significance value of .014
Table: 7.18a
FDI and growth in Sales
Model Summary
.703a .495 .423 3.733913
.642a .412 .328 4.807305
.606a .367 .277 16.484834
.774a .600 .543 21.173022
.594a .353 .191 22.448300
.053a .003 -.140 19.585594
.397a .158 .037 7.132757
.519a .269 .165 39.086882
.472a .223 .112 17.254379
.403a .162 .043 90.541436
.396a .157 .036 10.291345
.181a .033 -.106 5.223196
.038a .001 -.141 25.271464
.001a .000 -.143 22.268618
.107a .012 -.130 8.304500
.065a .004 -.138 4.225791
.615a .378 .289 32.051873
.088a .008 -.134 9.930414
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
316
Table: 7.18b
FDI and growth in Sales
Coefficients a
58.996 19.760 2.986 .020
-1.007 .385 -.703 -2.618 .034
-57.401 29.876 -1.921 .096
1.038 .468 .642 2.216 .062
-72.836 44.934 -1.621 .149
1.037 .515 .606 2.015 .084
63.657 12.151 5.239 .001
-2.266 .700 -.774 -3.239 .014
4.952 11.224 .441 .682
.319 .216 .594 1.476 .214
-.571 45.861 -.012 .990
.139 .990 .053 .140 .892
163.004 134.897 1.208 .266
-3.095 2.704 -.397 -1.145 .290
-89.240 35.805 -2.492 .041
2.067 1.287 .519 1.606 .152
-2.985 9.693 -.308 .767
.306 .216 .472 1.418 .199
95.061 43.283 2.196 .064
-1.099 .943 -.403 -1.165 .282
-788.942 697.092 -1.132 .295
15.552 13.645 .396 1.140 .292
-1.292 11.814 -.109 .916
.106 .217 .181 .486 .642
15.599 39.930 .391 .708
-.089 .888 -.038 -.100 .923
12.840 8.417 1.526 .171
.001 .279 .001 .003 .998
12.579 4.795 2.624 .034
.062 .217 .107 .285 .784
21.092 38.516 .548 .601
-.100 .577 -.065 -.173 .868
69.392 18.007 3.854 .006
-1.906 .925 -.615 -2.062 .078
131.007 540.934 .242 .816
-2.475 10.616 -.088 -.233 .822
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Salesa.
317
7.3.6.3 FDI and Growth in Total Exports: The regression analysis
run to assess the impact of FDI on growth in Export of FDI-based companies
reveal that FDI significantly influences the the growth in total exports in the case
of following companies(see table 7.19a and 7.19b)
• Astrazeneca Pharma India Ltd. which have an R square value of .515 and
beta(t) value of 2.724 with significance value of .030
• Biocon Ltd. which have an R square value of .764 and beta(t) value of
4.761 with significance value of .002
• Glaxosmithkline Pharmaceuticals Ltd. which have an R square value of
.707 and beta(t) value of 4.108 with significance value of .005
Table: 7.19a
FDI and growth in total exports
Model Summary
.110a .012 -.129 27.736832
.330a .109 -.018 25.200584
.717a .515 .445 51.381476
.874a .764 .730 33.842369
.399a .159 -.051 34.461517
.176a .031 -.107 117.793408
.841a .707 .665 14.486119
.485a .235 .126 45.147586
.167a .028 -.111 116.966967
.361a .131 .006 927.931204
.640a .410 .326 27.467333
.270a .073 -.060 43.508185
.043a .002 -.141 18.785109
.262a .069 -.064 29.212292
.140a .020 -.121 42.772024
.514a .264 .159 349.220292
.260a .068 -.066 221.940590
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
318
Table: 7.19b
FDI and growth in total exports
Coefficients a
61.354 146.783 .418 .688
-.835 2.858 -.110 -.292 .779
-138.294 156.615 -.883 .407
2.275 2.456 .330 .926 .385
-343.959 140.054 -2.456 .044
4.370 1.604 .717 2.724 .030
123.904 19.422 6.379 .000
-5.324 1.118 -.874 -4.761 .002
22.979 17.231 1.334 .253
.289 .332 .399 .871 .433
-121.132 275.819 -.439 .674
2.821 5.956 .176 .474 .650
-1116.590 273.967 -4.076 .005
22.556 5.491 .841 4.108 .005
-98.515 41.357 -2.382 .049
2.181 1.486 .485 1.467 .186
-9.720 65.711 -.148 .887
.659 1.465 .167 .449 .667
676.307 443.592 1.525 .171
-9.915 9.668 -.361 -1.025 .339
-4087.105 1860.521 -2.197 .064
80.337 36.417 .640 2.206 .063
70.117 98.406 .713 .499
-1.342 1.810 -.270 -.741 .483
4.720 29.681 .159 .878
.076 .660 .043 .115 .912
22.039 11.041 1.996 .086
-.264 .366 -.262 -.719 .495
-150.240 389.844 -.385 .711
2.182 5.844 .140 .373 .720
397.380 196.196 2.025 .082
-15.978 10.074 -.514 -1.586 .157
-8515.910 12089.642 -.704 .504
169.047 237.264 .260 .712 .499
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Total Exporta.
319
7.3.6.4 FDI and growth in Profit before Interest & Tax (PBIT): The
regression analysis run to assess the impact of FDI on growth in PBIT of
FDI-based companies reveal that FDI significantly influences the the
growth in PBIT in the case of following companies(see table 7.20a and
7.20b)
• Ranbaxy Laboratories Ltd. which have an R square value of .774
and beta(t) value of 4.893 with significance value of .002
Table: 7.20a
FDI and growth in PBIT
Model Summary
.303a .092 -.038 36.855663
.190a .036 -.102 24.494018
.576a .332 .236 62.480545
.293a .086 -.045 84.914089
.767a .589 .486 153.647460
.233a .054 -.081 137.875606
.564a .318 .221 29.206309
.069a .005 -.137 1163.715710
.260a .068 -.065 374.202682
.532a .283 .180 438.156585
.061a .004 -.139 30.050757
.095a .009 -.132 29.016471
.414a .171 .053 70.839763
.880a .774 .741 68.465733
.295a .087 -.043 14.046637
.262a .069 -.064 55.638407
.044a .002 -.141 113.034289
.227a .051 -.084 45.940080
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
320
Table: 7.20a
FDI and growth in PBIT
Coefficients a
187.223 195.040 .960 .369
-3.197 3.798 -.303 -.842 .428
-71.742 152.224 -.471 .652
1.220 2.387 .190 .511 .625
-279.732 170.307 -1.643 .144
3.638 1.951 .576 1.864 .105
84.481 48.733 1.734 .127
-2.274 2.806 -.293 -.811 .444
109.503 76.824 1.425 .227
-3.537 1.478 -.767 -2.392 .075
-230.943 322.843 -.715 .498
4.427 6.971 .233 .635 .546
1025.854 552.360 1.857 .106
-20.017 11.070 -.564 -1.808 .114
509.564 1065.998 .478 .647
-7.021 38.307 -.069 -.183 .860
-77.767 210.224 -.370 .722
3.344 4.688 .260 .713 .499
350.294 209.458 1.672 .138
-7.580 4.565 -.532 -1.660 .141
337.397 2035.511 .166 .873
-6.414 39.842 -.061 -.161 .877
28.532 65.629 .435 .677
-.306 1.207 -.095 -.253 .807
165.551 111.930 1.479 .183
-2.991 2.489 -.414 -1.202 .269
41.712 25.878 1.612 .151
-4.203 .859 -.880 -4.893 .002
-1.070 8.110 -.132 .899
.301 .367 .295 .818 .440
390.230 507.115 .770 .467
-5.457 7.602 -.262 -.718 .496
1.168 63.504 .018 .986
.379 3.261 .044 .116 .911
-1525.309 2502.468 -.610 .561
30.276 49.112 .227 .616 .557
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: PBITa.
321
7.3.6.5 FDI and growth in Profit after Tax (PAT): The
regression analysis run to assess the impact of FDI on growth in Profit
after Tax (PAT) of FDI-based companies reveal that FDI significantly
influences the the growth in PAT in the case of following companies(see
table 7.21a and 7.21b)
• Ranbaxy Laboratories Ltd. which have an R square value of .780
and beta(t) value of 4.987 with significance value of .002
Table: 7.21a
FDI and growth in PAT
Model Summary
.269a .072 -.060 43.545575
.227a .052 -.084 28.304767
.526a .277 .173 85.434820
.297a .088 -.042 104.905287
.672a .451 .314 204.133003
.272a .074 -.058 246.797916
.500a .250 .143 44.661857
.018a .000 -.142 104.718449
.125a .016 -.125 1591.933029
.513a .263 .158 517.290676
.080a .006 -.136 42.433275
.062a .004 -.139 44.256285
.391a .153 .032 84.495082
.883a .780 .749 61.685091
.276a .076 -.056 27.290511
.315a .100 -.029 65.968513
.515a .265 .160 584.828561
.224a .050 -.085 47.947251
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
322
Table: 7.21b
FDI and growth in PAT
Coefficients a
195.031 230.443 .846 .425
-3.319 4.487 -.269 -.740 .484
-104.110 175.907 -.592 .573
1.702 2.758 .227 .617 .557
-331.987 232.875 -1.426 .197
4.367 2.668 .526 1.637 .146
103.788 60.206 1.724 .128
-2.857 3.466 -.297 -.824 .437
142.762 102.067 1.399 .234
-3.560 1.964 -.672 -1.812 .144
-493.353 577.890 -.854 .422
9.349 12.478 .272 .749 .478
1321.626 844.661 1.565 .162
-25.841 16.929 -.500 -1.526 .171
-38.374 95.925 -.400 .701
-.162 3.447 -.018 -.047 .964
-305.365 894.336 -.341 .743
-6.646 19.942 -.125 -.333 .749
402.191 247.288 1.626 .148
-8.522 5.390 -.513 -1.581 .158
620.380 2874.250 .216 .835
-11.901 56.259 -.080 -.212 .838
34.842 100.098 .348 .738
-.301 1.842 -.062 -.163 .875
186.624 133.506 1.398 .205
-3.338 2.968 -.391 -1.124 .298
34.714 23.315 1.489 .180
-3.860 .774 -.883 -4.987 .002
-2.859 15.756 -.181 .861
.543 .714 .276 .761 .471
559.704 601.268 .931 .383
-7.928 9.013 -.315 -.880 .408
689.866 328.563 2.100 .074
-26.828 16.871 -.515 -1.590 .156
-1570.882 2611.803 -.601 .566
31.217 51.258 .224 .609 .562
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: PATa.
323
7.3.6.6 FDI and Growth in Assets :
The regression analysis run to assess the impact of FDI on growth in
assets of FDI-based companies reveal that FDI significantly influences
the the growth in assets in the case of following companies ( see table
7.22a and 7.22b)
• Fresenius Kabi Oncology Ltd. which have an R square value of
.752 and beta(t) value of 3.480 with significance value of .025
Table: 7.22a
FDI and growth in Assets
Model Summary
.069a .005 -.137 6.683209
.164a .027 -.112 5.992948
.124a .015 -.125 31.147461
.630a .397 .311 42.339026
.867a .752 .690 9.299536
.544a .296 .196 33.844202
.638a .407 .323 19.453205
.486a .236 .127 41.103793
.630a .397 .311 22.290697
.483a .233 .123 106.751387
.603a .363 .272 6.186855
.240a .058 -.077 9.287695
.201a .040 -.097 33.095264
.108a .012 -.130 19.265254
.494a .244 .137 2.274937
.582a .338 .244 16.549563
.349a .122 -.004 62.919325
.556a .309 .211 7.453413
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.Biocon Ltd.
Fresenius KabiOncology Ltd.Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.Sandu PharmaceuticalsLtd.Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
R R SquareAdjustedR Square
Std. Error ofthe Estimate
Predictors: (Constant), FDI(%)a.
324
Table: 7.22b
FDI and growth in Assets
Coefficients a
20.857 35.368 .590 .574
-.127 .689 -.069 -.184 .859
-9.062 37.245 -.243 .815
.257 .584 .164 .440 .673
-12.904 84.901 -.152 .883
.321 .973 .124 .331 .751
85.308 24.299 3.511 .010
-3.005 1.399 -.630 -2.148 .069
35.539 4.650 7.643 .002
-.311 .089 -.867 -3.480 .025
-113.224 79.248 -1.429 .196
2.938 1.711 .544 1.717 .130
833.638 367.906 2.266 .058
-16.178 7.374 -.638 -2.194 .064
-75.859 37.652 -2.015 .084
1.990 1.353 .486 1.471 .185
-5.374 12.523 -.429 .681
.600 .279 .630 2.148 .069
131.185 51.032 2.571 .037
-1.622 1.112 -.483 -1.458 .188
850.809 419.071 2.030 .082
-16.395 8.203 -.603 -1.999 .086
-5.247 21.007 -.250 .810
.253 .386 .240 .655 .534
58.484 52.292 1.118 .300
-.630 1.163 -.201 -.542 .605
19.376 7.282 2.661 .032
.069 .242 .108 .286 .783
8.081 1.313 6.152 .000
-.090 .060 -.494 -1.505 .176
314.040 150.840 2.082 .076
-4.277 2.261 -.582 -1.892 .100
73.808 35.349 2.088 .075
-1.786 1.815 -.349 -.984 .358
726.442 406.005 1.789 .117
-14.106 7.968 -.556 -1.770 .120
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
(Constant)
FDI(%)
Model1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Company Aventis Pharma Ltd.
Abbott India Ltd.
Astrazeneca PharmaIndia Ltd.
Biocon Ltd.
Fresenius KabiOncology Ltd.
Fulford (India) Ltd.
GlaxosmithklinePharmaceuticals Ltd.
K D L Biotech Ltd.
Kerala Ayurveda Ltd.
Matrix Laboratories Ltd.
Merck Ltd.
Novartis India Ltd.
Pfizer Ltd.
Ranbaxy LaboratoriesLtd.
Sandu PharmaceuticalsLtd.
Solvay Pharma India Ltd.
Wanbury Ltd.
Wyeth Ltd.
B Std. Error
UnstandardizedCoefficients
Beta
StandardizedCoefficients
t Sig.
Dependent Variable: Assetsa.
325
7.4 IMPACT OF FDI (FOREIGN PROMOTER QUOTA) ON THE
FINANCIAL PERFORMANCE OF SELECTED FDI-BASED
PHARMACEUTICAL COMPANIES – AN ANALYSIS BASED ON
AGGREGATE PARAMETERS.
In this case, FDI (% of foreign promoter in the Share holding pattern
of the company) is considered as independent variable and financial
ratios measured as dependent variables(see table 7.23a and 7.23b).
The analysis reveals that FDI significantly influences the following
ratios
• RONW with an R square value of .410 and beta(t) value of 2.357
with significance value of .046
• Inventory Ratio with an R square value of .686 and beta(t) value of
4.181 with significance value of .003
• Assets turnover ratio with an R square value of .703 and beta(t)
value of 4.350 with significance value of .002
326
Table: 7.23a
FDI and Indian Pharmaceutical Sector Model Summary
Dependent Variable Model R R Square
Adjusted R Square
Std. Error of the Estimate
Net Profit Margin 1 .018a .000 -.125 3.5756048
ROTA 1 .537a .289 .200 2.0962784
RONW 1 640a .410 .336 5.2186109
ROCE 1 .617a .380 .303 3.5344929
Current Ratio 1 .381a .145 .038 .1148430
Quick Ratio 1 .443a .196 .095 .1252576
D/E Ratio 1 .217a .047 -.072 .2308832
Proprietary Ratio 1 .107a .011 -.112 .0409346
Stock Turnover Ratio 1 .217a .047 -.072 .5337671
Inventory Ratio 1 .828a .686 .647 .0401548
Assets Turnover Ratio 1 .838a .703 .666 .1347429
R&D Expenses ratio 1 .568a .323 .238 .0076878
Growth in FOREX Earnings 1 .239a .057 -.077 154.1656185
Growth in Sales 1 .205a .042 -.095 11.3656430
Growth in exports 1 .374a .140 .017 54.2928683
Growth in PBIT 1 .104a .011 -.130 59.2718418
Growth in PAT 1 .198a .039 -.098 103.4643411
Growth in Assets 1 .452a .205 .091 9.9992581
327
Table: 7.23b
FDI and Indian Pharmaceutical Sector Coefficients
Dependent Variable Model Unstandardized Coefficients Standardized
Coefficients t Sig. B Std. Error Beta
Net Profit Margin
1 (Constant) 18.105 13.754 1.316 .225
FDI -.015 .298 -.018 -.050 .961
ROTA 1 (Constant) 26.145 8.064 3.242 .012
FDI -.315 .175 -.537 -1.803 .109
RONW 1 (Constant) 63.899 20.074 3.183 .013
FDI -1.025 .435 -.640 -2.357 .046
ROCE
1 (Constant) 47.225 13.596 3.473 .008
FDI -.653 .296 -.617 -2.216 .058
Current Ratio
1 (Constant) 1.437 .442 3.254 .012
FDI .011 .010 .381 1.164 .278
Quick Ratio 1 (Constant) .438 .482 .908 .390
FDI .015 .010 .443 1.396 .200
D/E Ratio 1 (Constant) -.022 .888 -.025 .981
FDI .012 .019 .217 .630 .546
Proprietary Ratio
1 (Constant) .616 .157 3.912 .004
FDI -.001 .003 -.107 -.305 .768
Stock Turnover Ratio
1 (Constant) 5.334 2.053 2.598 .032
FDI .028 .044 .217 .628 .547
Inventory Ratio
1 (Constant) .965 .154 6.244 .000
FDI -.014 .003 -.828 -4.181 .003
Assets Turnover Ratio
1 (Constant) 3.298 .518 6.364 .000
FDI -.049 .011 -.838 -4.350 .002
R&D Expenses ratio
1 (Constant) -.035 .030 -1.186 .270
FDI .001 .001 .568 1.953 .087
Growth in Forex Earnings
1 (Constant) 535.581 707.034 .758 .473
FDI -9.852 15.113 -.239 -.652 .535
Growth in Sales
1 (Constant) 41.882 52.125 .803 .448
FDI -.617 1.114 -.205 -.554 .597
Growth in exports 1 (Constant) 308.463 248.998 1.239 .255
FDI -5.682 5.322 -.374 -1.067 .321
Growth in PBIT
1 (Constant) -36.574 271.832 -.135 .897
FDI 1.1613 5.810 .104 .278 .789
Growth in PAT 1 (Constant) 256.581 474.508 .541 .605
FDI -5.420 10.143 -.198 -.534 .610
Growth in Assets 1 (Constant) 82.849 45.859 1.807 .114
FDI -1.315 .980 -.452 -1.342 .222
328
TEST OF HYPOTHESES
Based upon the analysis carried out, the following hypotheses are
accepted/rejected. The explanation for which is given below
S.No Hypotheses Result
1. H01: There is no significant impact of FDI on the profitability
of select pharmaceutical firms in India Rejected
2. H02: There is no significant impact of FDI on the liquidity of
select pharmaceutical firms in India Accepted
3. H03: There is no significant impact of FDI on the solvency of
select pharmaceutical firms in India Accepted
4. H04: There is no significant impact of FDI on the efficiency of
select pharmaceutical firms in India Rejected
5. H05: There is no significant impact of FDI on the R & D
expenses of select pharmaceutical firms in India Accepted
6. H06: There is no significant impact of FDI on the growth in
exports of select pharmaceutical firms in India Accepted
7. H07: There is no significant impact of FDI on the sales of
select pharmaceutical firms in India Rejected
8. H08: There is no significant impact of FDI on the capital
employed of select pharmaceutical firms in India Rejected
SUMMARY RESULT OF TEST OF HYPOTHESES
FDI significantly influences Profitability as measured through (Return
on Net Worth ) of Select Pharmaceutical firms in India (Refer table 7.23a
and 7.23b).
FDI does not significantly influences the Liquidity of Select
329
Pharmaceutical firms in India (Refer table 7.23a and 7.23b).
FDI does not significantly influences the solvency of Select
Pharmaceutical firms in India (Refer table 7.23a and 7.23b).
FDI significantly influences the efficiency as measured through
(Assets turnover ratio) of Select Pharmaceutical firms in India (Refer
table 7.23a and 7.23b).
FDI does not significantly influences the R & D expenses of Select
Pharmaceutical firms in India (Refer table 7.23a and 7.23b).
FDI significantly influences sales of Select Pharmaceutical firms in
India (Refer table: 7.4a and 7.4b).
FDI significantly influences capital employed of Select Pharmaceutical
firms in India (Refer table: 7.4a and 7.4b).
However, it can be depicted that FDI inflows have an impact on the
growth of Select Pharmaceutical firms in India measured through
profitability, efficiency, sales and capital employed.