Economic Value-Added as an Emerging Tool of Performance Measurement : Evidence from Indian Companies

The concept of Economic Value-Added (EVA) is of recent origin. Considering its importance in the corporate world, it becomes vital to understand its role in shareholders' value creation and performance measurement for companies. The present study is an attempt to analyze the relationship between EVA and the traditional measures, i.e., Earnings Per Share (EPS), Return on Invested Capital (ROIC) and Return on Net Worth (RONW). Using a sample of 50 companies listed on Nifty 50 index of National Stock Exchange, India from 2009-10 to 2013-14, the study ranks the select companies based on their mean EVA. The study concludes that there exists significant difference between the mean values of the considered variables of the select companies. It also reveals that ROIC has significant influence on EVA