The Relationship between the Stock Price and Investments in Subsidiaries under the Equity Method (TAS 27) of Thai Listed Companies

Main Article Content

Wattana Srithaworn
Yodsawinkan Kobkanjanapued

Abstract

The objectives of this research were to study the relationship between stock prices and investments in subsidiaries according to the equity method under TAS 27 of companies listed on the Stock Exchange of Thailand and to analyze the relationship classified by industry groups. Study periods were during the years 2017 – 2019. The total number of samples was 513. This research was quantitative research using statistics such as descriptive statistics, correlation analysis, and multiple regression analysis. Research results showed that investments in subsidiaries under the equity method have a positive relationship with the stock price, and when classified by type of industry. It was found that investments in subsidiaries under the equity method of companies in the agricultural & food industry, industrial products, real estate and construction, and the resources group have a positive relationship with the stock price, while investments in subsidiaries under the equity method of companies in the consumer goods, service, and technology groups have no relationship with the stock price.

Downloads

Download data is not yet available.

Article Details

Section
Research Article

References

Acaranupong, K. (2017). Comparative Value Relevance of Earnings, Book Values and Cash Flows:

Empirical Evidence from Listed Companies on SET100 in Thailand. Journal of Accounting Profession JAP, 13(38), 95-114.

Am-ugsorn, S. (2012). Advanced Accounting 2 (2nd ed.). Bangkok: Triple Group.

Brief, R. P., & Zarowin, P. (1999). The Value Relevance of Dividends, Book Value and Earnings. NYU Working Paper No. 2451/27590.

Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2014). Multivariate Data Analysis (7th ed.). Upper Saddle River: Pearson Education Limited.

Kobkanjanapued, Y. (2019). The Relationship Between Book Value Per Share, Earnings Per Share and Investment in Subsidiaries with Stock Price of Listed Companies in the MAI. In RSU National Research Conference 2019 (Pp. 906-915), April 26, 2019. Pathum Thani: Rangsit University.

Kobkanjanapued, Y. (2020). The Value Relevance of Book Value and Earnings per Share to Explain the Stock Prices Before and Early Stage After TFRS 15 Applications: Evidence from the Stock Exchange of Thailand. Journal of Accounting Profession JAP, 16(52), 24-44.

Kobkanjanapued, Y. (2021). Value Relevance of Book Value, Accounting Earnings and Operating Cash Flows in Explaining Security Prices of Thai Listed Companies During the COVID-19 Situation. Rajapark Journal, 15(40), 79-95.

Kumari, S. S. (2008). Multicollinearity: Estimation and Elimination. Journal of Contemporary Research in Management, 3(1), 87-95.

Nukunkaew, K. (2006). The Effect of Net Income Based on the Equity Method and the Cost Method on Stock Returns(Master's thesis). Chulalongkorn University.

Ohlson, J. A. (1995). Earnings, Book Values and Dividends in Security Valuation. Contemporary Accounting Research, 11, 661–687.

Phakdee, A., & Srijunpetch, S. (2020). The Value Relevance of Accounting Information in Financial Industry: 15-Year Perspective. Journal of Business Administration The Association of Private Higher Education Institutions of Thailand, 9(1), 196-214.

Pratomsrimek, S. (2015). Financial Reporting: Thai Financial Reporting Certification Exam Preparation Guide. Bangkok: N4 Proprint Co., Ltd.

Silvia, M. (2014). Intro to Consolidation and Group Accounts – Which Method for your Investment?. Retrieved March 16, 2021, from https://www.cpdbox.com/intro-to-consolidation-and-group-accounts

Tabachnick, B. G., Fidell, L. S., & Ullman, J. B. (2013). Using Multivariate Statistics (6th ed.). Boston. MA: Pearson.

TFAC. (2016). TAS 27 (Revised 2016) Separate Financial Statements. Retrieved December 9, 2020, from http://www.tfac.or.th/Article/Detail/78326

TFAC. (2017). Handbook of Accounting Standards TAS 28 Investments in Associates and Joint Ventures. Retrieved December 10, 2020, from http://www.tfac.or.th/upload/9414/GUWs4eGXRS.pdf

Yutian, L., & Visedsun, N. (2014). Value Relevance of Earnings Per Share and Book Value Per Share of the Listed Companies on the Stock Exchange of Shenzhen. Journal of Accounting Profession JAP, 10(27), 5-13.

Zainal, D., Ibrahim, M. K., Kamarudin, K. A., & Kaur, J. (2005). The Relative Value Relevance of Earnings and Book Value in Malaysia and Singapore, in Financial Reporting in Malaysia: Further Evidence. Retrieved December 10, 2020, from https://www.researchgate.net/publication/268280100_Chapter_The_Relative_Value_Relevance_of_ Earnings_and_Book_ Value_in_Malaysia_and_Singapore_in_Financial_Reporting_in_Malaysia_Further_Evidence