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The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar

Diversification is a common strategic planning that most managers will do in order to expand their business and enhance their firms performance but how related it is to the firms' performance is still questionable to this day (T. Ravichandran, Yu Liu, Shu Han & Iftekhar Hasan (2009)). Studi...

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Main Author: Mustafar, Nurul Hazwani
Format: Student Project
Language:English
Published: 2017
Subjects:
Malaysia
Industrial productivity
Organizational effectiveness. Performance measurement
Kuala Lumpur. KLSE
Online Access:https://ir.uitm.edu.my/id/eprint/53107/1/53107.pdf
https://ir.uitm.edu.my/id/eprint/53107/
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spelling my.uitm.ir.531072022-01-03T09:29:40Z https://ir.uitm.edu.my/id/eprint/53107/ The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar Mustafar, Nurul Hazwani Malaysia Industrial productivity Organizational effectiveness. Performance measurement Kuala Lumpur. KLSE Diversification is a common strategic planning that most managers will do in order to expand their business and enhance their firms performance but how related it is to the firms' performance is still questionable to this day (T. Ravichandran, Yu Liu, Shu Han & Iftekhar Hasan (2009)). Studies done before stated that there is a positive relationship between diversification and firm performance (Bettis, A. R. & Hall, W K, (1982), Olu Ojo (2009), Mansi, S A & Reeb D M (2002)) but there are studies that resulted in opposite view which is there is negative relationship between these two variables (Lang, L HP. & Stulz, R M1994), Serveas (1996), Lins and Serveas (1999). However, the studies were mostly done in the developed country but only a few were done in developing countries or to be specific in the view of Malaysia. Thus, in this paper, researcher tries to examine the level of diversification based on selected companies chose from various sectors in Bursa Malaysia and to study its impact towards the firms performance. The level of diversification is determined by using the famous Specialization Ratios (SR) which later will classify them into three different classes whereas Return on Asset (ROA), Return on Equity (ROE) and Return on Investment (RO will be used as a proxy to measure the firms performance. The paper concludes that there is a positive relationship between levels of diversification and a firms' performance. In terms of return undiversified firms may perform better than others but in terms of riskiness highly diversified firms may have better chance in reducing it. 2017 Student Project NonPeerReviewed text en https://ir.uitm.edu.my/id/eprint/53107/1/53107.pdf ID53107 Mustafar, Nurul Hazwani (2017) The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar. [Student Project]
institution Universiti Teknologi Mara
building Tun Abdul Razak Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Teknologi Mara
content_source UiTM Institutional Repository
url_provider http://ir.uitm.edu.my/
language English
topic Malaysia
Industrial productivity
Organizational effectiveness. Performance measurement
Kuala Lumpur. KLSE
spellingShingle Malaysia
Industrial productivity
Organizational effectiveness. Performance measurement
Kuala Lumpur. KLSE
Mustafar, Nurul Hazwani
The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar
description Diversification is a common strategic planning that most managers will do in order to expand their business and enhance their firms performance but how related it is to the firms' performance is still questionable to this day (T. Ravichandran, Yu Liu, Shu Han & Iftekhar Hasan (2009)). Studies done before stated that there is a positive relationship between diversification and firm performance (Bettis, A. R. & Hall, W K, (1982), Olu Ojo (2009), Mansi, S A & Reeb D M (2002)) but there are studies that resulted in opposite view which is there is negative relationship between these two variables (Lang, L HP. & Stulz, R M1994), Serveas (1996), Lins and Serveas (1999). However, the studies were mostly done in the developed country but only a few were done in developing countries or to be specific in the view of Malaysia. Thus, in this paper, researcher tries to examine the level of diversification based on selected companies chose from various sectors in Bursa Malaysia and to study its impact towards the firms performance. The level of diversification is determined by using the famous Specialization Ratios (SR) which later will classify them into three different classes whereas Return on Asset (ROA), Return on Equity (ROE) and Return on Investment (RO will be used as a proxy to measure the firms performance. The paper concludes that there is a positive relationship between levels of diversification and a firms' performance. In terms of return undiversified firms may perform better than others but in terms of riskiness highly diversified firms may have better chance in reducing it.
format Student Project
author Mustafar, Nurul Hazwani
author_facet Mustafar, Nurul Hazwani
author_sort Mustafar, Nurul Hazwani
title The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar
title_short The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar
title_full The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar
title_fullStr The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar
title_full_unstemmed The relationship between level of diversifications and the performance of selected companies in Bursa Malaysia / Nurul Hazwani Mustafar
title_sort relationship between level of diversifications and the performance of selected companies in bursa malaysia / nurul hazwani mustafar
publishDate 2017
url https://ir.uitm.edu.my/id/eprint/53107/1/53107.pdf
https://ir.uitm.edu.my/id/eprint/53107/
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score 13.211869

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