EVA: Critical financial success factor for Indian Industry: A Case study of selected sectors

Financial Performance of any Organization can be measured through various traditional measures like Return on Capital Employed, Return on Equity, Earning Per Share, Net Profit Margin etc., but for maximization of Shareholder’s wealth the modern tool like Economic Value Added (EVA) can also be used. EVA, that triggers Shareholder Value, is currently adopted by the major companies as strategic measure of value addtion. The capital providers of the firm i.e., Shareholders invest their money for their individual profit objective. This paper analyses the EVA and its relation with ROCE and Net Profit. With the help of case study of 15 Indian companies. The paper concluded as variables ROCE and NOPAT both explains the variance in the level of EVACE and  ANOVA analysis revealed that differences in level of ROCE, NOPAT and EVACE during the 6 years period of the study, have not shown significant difference