dc.contributor.author | Nyangweso, Lucas O | |
dc.date.accessioned | 2013-05-12T06:59:33Z | |
dc.date.available | 2013-05-12T06:59:33Z | |
dc.date.issued | 2003-09 | |
dc.identifier.citation | MBA | en |
dc.identifier.uri | http://erepository.uonbi.ac.ke:8080/xmlui/handle/123456789/22222 | |
dc.description | Master of Business Administration | en |
dc.description.abstract | The study set out to determine the role financial ratios help in forecasting the
success or failure of a rights issue.
This is a number of companies at the Nairobi Stock Exchange have failed in
their attempt to raise capital through a right issue. There is no evidence to be
relied on in explaining failure of these companies to raise the required
capital through a rights issue.
The approach in this study is to compare ratios that capture performance and
financial position of the firms that offered a right issue before and after the
right issue. The three year (at times five years) average before and after the
issues are compared to decipher information useful in explaining the success
or otherwise right issue.
The findings show that the successful firms performance and financial ratios
outperformed the less successful ones. The ratios that have higher
discriminating power were return on equity, debt equity ratio, dividend
payout ratio, growth in dividends and earnings net worth to total assets.
The one that had poor explanatory powers are growth in total assets, profit
margin, cash flow to debt.
The tentative conclusion of the finding is that investors may rely on ratios
extracted from financial statements in making the decision to exercise their
right or not. | en |
dc.language.iso | en | en |
dc.title | Financial statements and success of rights issues at the Nairobi stock exchange:1998 - 2002 | en |
dc.type | Thesis | en |
local.publisher | School of Business, University of Nairobi | en |