Students’ Research Symposium - Department of Finance (SRS-DFIN)
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Item The Impact of Cognitive and Emotional Behavioral Biases on Stock Investment Decision Making in CSE Sri Lanka: Evidence from Gampaha District(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Ratnavel, Akash; Gunasekara, A.L.Introduction: Understanding the cognitive and emotional biases that influence investment decisions is crucial, especially in the context of the Colombo Stock Exchange (CSE), which plays a critical role in determining market trends and impacting Sri Lanka's overall economy. Methodology: This study employs a structured questionnaire. The behavioral biases consider in this study are Disposition Effect, Anchoring Bias, Overconfidence, and Herding Behavior and they are measured through a structured questionnaire with a 5-point Likert scale. The population comprises individual investors in Gampaha, with a sample size of 105 chosen through convenient sampling. Findings: The model suggests that herding behavior, disposition effect, and anchoring bias have a more pronounced influence as behavioral biases, while overconfidence has a relatively lesser impact on the investment decision-making of individual investors at the Colombo Stock Exchange. Conclusion: This study reveals a substantial impact of behavioral biases on investment decisions at the Colombo Stock Exchange.Item The Impact of Integrated Reporting Quality on Cost of Equity and Financial Performance: Evidence from Licensed Commercial Banks in Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) De Silva, W.A.C.R.; Gunasekara, A.L.Introduction: This empirical study examines the influence of Integrated Reporting Quality (IRQ) on the Cost of Equity (KE) and financial performance within the context of listed Commercial banks in Sri Lanka spanning the years 2013 to 2022. Despite existing research and literature exploring the link between IRQ, cost of equity, and financial performance in the banking industry, uncertainties persist. Methodology: The study focuses on the top 10 Licensed Commercial Banks in Sri Lanka that adhere to integrated reporting practices. Adopting a quantitative, deductive approach grounded in positivism philosophy, the research utilizes secondary data. Analysis employs quantitative techniques such as descriptive statistics, correlation analysis, and regression analysis to assess hypotheses formulated in response to the research question. STATA software is employed for data analysis, with panel data utilized for the study. Findings: The study incorporates three models: the Return on Assets (ROA) model, Return on Equity (ROE) model, and Cost of Equity (Ke) model. The findings, based on various statistical methods, reveal a positive and statistically significant relationship between IRQ and ROA at the 1% significance level. Additionally, a negative and statistically significant relationship is observed between IRQ and ROE in Licensed Commercial Banks in Sri Lanka at the 5% significance level, along with a negative and statistically significant relationship between IRQ and Ke at the 1% significance level. Conclusion: To enhance Integrated Reporting (IR) practices in Licensed Commercial Banks, recommendations include fostering regular stakeholder engagement, demonstrating value creation through the use of technology, and developing mechanisms for effective communication.Item The Influence of Retirement Goals and Risk Perception on Retirement Planning Behaviour; Evidence from Kalutara and Gampaha Districts, Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Perera, I.K.H.; Weerasinghe, W.D.J.D.Introduction: One of the most critical problems that are faced by many emerging countries is the lack of retirement savings for future lives and pre-retires. To express fresh thoughts and suggest an extra approach or workable solution to supplement past research and conclusion, this study will analyze how the retirement goals and risk perception will affect on retirement planning behaviour of individuals in Kalutara and Gampaha district gender wise. Methodology: Based on the positivism research philosophy and deductive research logic quantitative approach was used to collect the primary data through an online survey of 196 participants. Retirement goals and risk perception are independent variables and retirement planning behaviour is the dependent variable of this study. Using SmartPLS software, Structural Equation Model (SEM) and AMOS regression analysis were used to test the reliability, normality, correlation, multicollinearity, regression analysis, and gender effect in both districts. Descriptive statistics were used to determine the mean values of respondents' perspectives. Findings: Research findings output that both independent variables (retirement goals and risk perception) had a statistically significant positive relationship with the dependent variable (retirement planning behaviour) in both districts. Cronbach alpha values demonstrate that all data sets are more reliable and as per the VIF values, independent variables are not correlated with each other. Both retirement goals and risk perception are more effective in the retirement planning behaviour of the Gampaha district data set. Gender is also having a significant impact on retirement planning behaviour. Conclusion: The results highlight that the overall model is statistically significant, and retirement planning behaviour has an impact on retirement goals and risk perception.Item The Impact of Service Quality, Customer Satisfaction, and Corporate Image in Building Customer Loyalty in The Sri Lankan Banking Industry(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Wijerathna, K.G.D.T.U.; Gunasekara, A.L.Introduction: The banking industry is experiencing intense competition, necessitating the development of strategies to retain existing customers rather than solely focusing on customer acquisition. Cultivating customer loyalty is crucial for the long-term sustainability of banks. This study investigates the impact of service quality, customer satisfaction, and corporate image on customer loyalty within the Sri Lankan banking sector. Methodology: A structured questionnaire was employed to gather primary data from 380 bank customers in the Colombo district. Data collection utilized a Likert-type scale questionnaire administered to randomly intercepted customers exiting banks. Descriptive and inferential statistical techniques were applied to analyze the collected data using the SPSS software package. Findings: The findings reveal a positive and significant impact of service quality, customer satisfaction, and corporate image on customer loyalty. These results imply that banks should prioritize enhancing service quality, ensuring customer satisfaction, and fostering a positive corporate image to cultivate customer loyalty. These findings suggest that banks should focus on improving service quality as a primary strategy for increasing customer loyalty. Banks should also invest in initiatives that enhance customer satisfaction and project a positive corporate image to further boost customer loyalty. Conclusion: Overall, the study's findings provide valuable insights for banks in Sri Lanka on how to cultivate customer loyalty and achieve long-term success in the increasingly competitive banking landscape.Item The Impact o0f Cryptocurrency on the Stock Market Performance in Sri Lanka: An Empirical Study Based on Bitcoin(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Perera, G.J.P.; Weerasinghe, W.D.J.D.Introduction: This study examines the impact of cryptocurrency on the stock market performance in Sri Lanka. It is an empirical study based on Bitcoin. Methodology: The analysis uses the information of Bitcoin and the Stock market indices, ASPI Return, and S&P SL20 Return of Sri Lanka for the period 2010–2023 on a weekly basis. The Generalized Autoregressive Conditional Heteroskedasticity (GARCH) model has been estimated separately for the ASPI Return and S&P SL20 Return time series data using the Maximum Likelihood (ML) method with the Autoregressive Conditional Heteroskedasticity (ARCH) algorithm. Findings: The empirical results indicate a weak negative relationship between Bitcoin returns and ASPI Returns, suggesting a subtle inverse correlation. In contrast, a weak positive relationship is observed between Bitcoin returns and S&P SL20 returns in the Sri Lankan context. These findings provide insights into the dynamic interactions between Bitcoin and the two stock market indices in Sri Lanka. Conclusion: This paper makes two significant contributions to the existing body of knowledge. Firstly, it introduces Bitcoin returns as a determinant influencing stock market performance in Sri Lanka. Secondly, it explains the relationships between Bitcoin and both ASPI Return and S&P SL20 Return in the Sri Lankan market context, enriching our understanding of the dynamics between cryptocurrency and traditional stock indices.Item Impact of Integrated Reporting on Firm Value of Listed Companies in Consumer Discretionary Sector in Sri Lanka: Analysis of Moderating Effect of External Financing(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Kodithuwakku, N.R.; Gunasekara, A.L.Introduction: Integrated reporting is new approach to business reporting that is built around the organization’s strategy to create and sustain value in the short, medium and long term. This process results in the production of a periodic integrated report, which according to the framework issued by the IIRC. This study aims to investigate the impact of integrated reporting on firm value of listed companies in consumer discretionary sector in Sri Lanka by considering moderating effect of external financing. Methodology: This research develops an informative outcome, covering 13 consumer discretionary sector companies listed in the Sri Lankan Stock Exchange from 2015 to 2022. The integrated reporting was measured using content analysis with the support of an integrated reporting developed index and, the firm value was measured by Tobin’s Q. In analyzing the data, the study adopted the panel regression using Stata -13 software. Findings: The study results revealed that integrated reporting has an insignificant positive relationship with firm value, and this relationship is not strengthened in firms with higher needs for external financing. Conclusion: Sri Lankan consumer discretionary sector companies have failed to gain the benefits of integrated reporting yet.Item Exploring the Potential of Social Value Creation Through Digital Social Innovation in Sri Lanka: Special Reference to Gampaha District(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Shalomi, K.H.; Weerasinghe, W.D.J.D.Introduction: This research explores the potential of social value creation through digital social innovation in Sri Lanka, with a special focus on the Gampaha District. Social entrepreneurship, driven by a combination of entrepreneurial spirit and social innovation, aims to address pressing societal challenges and create innovative solutions. Despite the global attention to social entrepreneurship, there is a dearth of research in the Sri Lankan context, particularly regarding the role of technology in innovation and social value creation. Methodology: The study adopts a social constructivist paradigm and employs the Case Study Methodology (CSM) to investigate ten social enterprises. The research questions examined include how social value is created through social enterprises and how social entrepreneurs leverage new technologies for innovation. Findings: The findings reveal that social value creation in Sri Lanka occurs through economic impact, socioeconomic improvements, social impact, community engagement, and innovative solutions. Moreover, the importance of managing new technologies for innovation is evident, with technology adoption, innovation strategies, skills development, and resource constraints emerging as key factors. Conclusion: This research contributes to the understanding of how social enterprises in Sri Lanka create social value and harness technology for innovation. The findings highlight the need for more support for social entrepreneurs and the integration of digital technologies in their endeavours. The study emphasizes the role of social entrepreneurship in driving positive change and creating social value in Sri Lanka, and the potential for technology to amplify this impact.Item The Impact of Integrated Reporting Quality on the Financial Performance of Listed Insurance Companies in Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Yamasinghe, A.S.; Piayananda, S.D.P.Introduction: Integrated reporting quality (IRQ) is an emerging concept followed by organizations globally. The purpose of the study is to determine the impact of IRQ on the financial performance of Insurance Companies in Sri Lanka. Methodology: This study considers 11 Insurance companies listed on the Colombo Stock Exchange (CSE) for the period from 2013 to 2022 as the sample. In this regard, secondary data was collected using annual reports. IRQ was employed as an independent variable in this study, with financial performance as the dependent variable. The data is analyzed using descriptive statistics, correlation analysis, and panel regression analysis using return on assets and return on equity as proxies. Data analysis was conducted using STATA statistical software. Findings: According to the study found that there is no significant relationship between IRQ and the financial performance of insurance companies in Sri Lanka. Independent variables are not correlated with each other, as per the results of the inter-correlation matrix and VIF values. According to Hausman's test random effect model was selected to assess both return on equity and return on assets. The results of the random effect model regression analysis show that IRQ and growth opportunity does not have impact on ROA. Further, IRQ, and Mtb have an insignificant positive impact on ROE at 5% significance level. Conclusion: The results of this study will help regulators apply IIRF in the Sri Lankan setting and prepare annual reports. The results have ramifications for policy makers and those who produce annual reports because investor relations significantly affects both market and financial performance.Item Sustainable Development Goal Reporting: Effect of Institutional and Corporate Governance Factors(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Herath, R.H.M.M.S.; Kethmi, G.A.P.Introduction: Businesses in today’s context are expected to disclose more on the sustainable development goal reporting within their organization. Although there is an increasing trend in the sustainability reporting disclosure in Sri Lanka, this corporate reporting varies in content and quality, and there is a challenge in incorporating SDG goals in the process of sustainability reporting. The main objective of this study is to examine the extent to external institutional factor influence on content and quality of corporate SDG disclosure and examine the extent of corporate governance factors influence on the content and quality of corporate SDG disclosure. Methodology: Three dependent variables, SDG Acknowledgement, SDG Prioritization and SDG Extent are used while GRI Compliance, Sustainability Assurance CEO Duality and CSR committee are the independent variables. Data of the top 50 listed companies of CSE as at 2023 August are collected for a period from 2021 to 2022. Regression analysis is employed using SPSS to achieve the objective. Findings: According to the results, GRI Compliance, Sustainability Assurance and CSR committee have a significant positive impact on SDG Acknowledgement while the impact of CEO Duality is insignificant. The same results are obtained from the regression model results developed for the SDG Extent. Further, only GRI Compliance and CSR committee have a positive significant on SDG Prioritization while other variables’ impact is insignificant. Conclusion: According to the study SDG reporting practices are developing trends by external institutional factors and corporate governance factors. The study concludes there is a need for more accurate SDG reporting frameworks that support companies to match their business functions and strategies with SDGs.Item The Impact of Integrated Reporting Practices on the Firm Value of Insurance Companies in Sri Lanka:Analysis of Moderating Effect of External Financing(Department of Finance, Faculty of Commerce and Management Studies University of Kelaniya Sri Lanka, 2024) Imesha, B. Achila; Gunasekara, A.L.Introduction: The aim of this study is to evaluate the impact of integrated reporting practices on the firm value in insurance companies in Sri Lanka by analyzing the moderating effect of external financing. Methodology: This study use data of 13 Insurance Companies from 2015 to 2022.The study conducted by using panel regression analysis. The data was obtained from the published annual financial reports of the sampled insurance companies. IR was measured by using content analysis and Tobin’s Q as a proxy for firm value. Findings: The results of the regression analysis revealed that IR positively and significantly effects the firm value in insurance companies in Sri Lanka while supporting the findings of the prior literature. When it is higher the disclosure level of IR company, it will earn a relatively higher firm value. Conclusion: The paper concluded that the IR effects the firm value in Insurance companies in Sri Lanka.