Impact of Intellectual Capital Efficiency on Firm performance, CAPM expected return and Value at Risk of IT MNCs in India

This study analyzes the effect of Intellectual Capital Efficiency on firm performance, CAPM expected return and Value at Risk of IT MNCs in India. The best performing Ten IT companies was chosen for the study, the ICE was gauged using Value Added (VA) and Modified Value Added Intellectual Coefficient (M-VAICTM). The study uses secondary data for 10 years from 2007 to 2016 and empirically analyses the relationship of VA and the components of M-VAICTM with Firm performance indicators (ROA, ROE, EPS and NPM), CAPM Expected return and Value at Risk of the selected IT MNCs in India. The study employed panel regression for disproving hypotheses. The result of the study reports that there is a statistically significant and positive impact Intellectual capital on firm performance parameters. Intellectual capital negatively impacts the CAPM expected return. The study showed that the Value at Risk will be reduced if IC coefficient is high. High level of HCE and CEE reduces Value At Risk. The study is limited in analyzing only IT industry and the number of companies taken for the analysis is limited