Impact Measurement of Investment Returns: A Case Study of Coal Industry in Indian CPSEs

Abstract

Investment return may be defined as a recital gauge which is used to compute the effectiveness of an investment. In addition, it helps to assess the competency of dissimilar investments at a dot of occasion. Return on investment is an endeavour to straightforwardly calculate the income of a finicky investment in relative to the outlay of its investment. In this background, the present research paper is an attempt to study the impact of investment returns of coal industry in Indian CPSEs during 2010-11 to 2019-20. Overall, the coal industry has generated positive returns in terms of ROA, ROCE, and ROE. The sub-period analysis reveals that on the average, investment returns in terms of ROA and ROCE have decreased from 1st half to 2nd half, while investment returns in terms of ROE has improved from 1st half to 2nd half of the study. Moreover, all the investment ratios (except ROCE in the 2nd half) show relatively stable performance. Furthermore, 1st half shows better consistency in ROA and ROCE as compared to that in the 2nd half, while ROE marginally shows better consistency in the 2nd half as compared to that in the 1st half. The noteworthy positive impact in ROE implies that coal industry plays a crucial position in the monetary enlargement of the Indian economy. Hence, the Govt. must take essential steps earn more returns on investment and thus helps in the economic development of the country.